The price has formed a base
This analysis focuses on GBP/USD, highlighting a bullish scenario based on price action and key resistance levels.
Key Observations:
Support Zone: The price has formed a base at the lower highlighted zone (purple rectangle), suggesting a potential bullish continuation from this area.
Immediate Resistance: A smaller resistance level is observed just above the current price, around 1.22300, which may act as a retest zone before further upward movement.
Target Zone: The upper resistance zone around 1.23200 is the primary target for this bullish setup, as it represents a key area where sellers may re-enter.
Trade Idea:
Enter a long position after confirmation of support at the lower purple zone, aiming for the 1.23200 resistance zone.
Watch for a potential retest of the minor resistance level at 1.22300 before the upward continuation.
Considerations:
A breakout of the minor resistance zone (1.22300) will strengthen the case for reaching the higher target.
Volume analysis also suggests momentum may increase in favor of the buyers.
Risk Management: Place a stop-loss below the lower purple zone to manage downside risk, ensuring a favorable risk-to-reward ratio.
This setup highlights the importance of observing reactions at resistance levels and retests for confirmation of the bullish move. Let me know if you need refinements!
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