GBP/USD Caught in the Middle at 1.3400?

The Great Britain pound versus the United States dollar currency pair seems to be indecisive. But doesn’t it left any clues behind?

Long-term perspective
Following the fall from the 1.2818 high, the price bottomed at 1.2251, from where it continued the ascending movement. As a result, the rising trend continued until very close to the 1.3502 intermediary level.
But as the bulls extended a little too far and too fast, their movement above the triple resistance — defined by the 1.3261 firm level, the falling trendline, and the upper line of the channel — proved to be an exhaustive one.
As a result, the price ebbed until the 1.2675 low. However, from there, the bulls pulled themselves together, challenging the resistance one more. As the 1.3261 level was, this time, not reinforced by the other two lines, the bulls conquered it, under unpleased bearish observation, as the 1.3134 low points out.
Still, even more determined than ever, the bulls sent the price to the next area of importance: the double resistance made up by 1.3616 level and the same upper line of the channel that was part of the previously mentioned triple resistance.
Only from there, the bulls allowed the price to drop. As expected, the bears quickly entered the scene, printing a bearish engulfing on December the 18th and stamping a gap.
Yet, the bulls swiftly rejected their push beneath the bearish favoring level of 1.3261, etching the 1.3187 low in the process.
So, as long as 1.3261 remains support, the bulls can once more drive the price to 1.3502 and then to 1.3619. Only if 1.3261 cedes, then the bears may extend the decline to 1.3000.

Short-term perspective
From the 1.3134 low, which validated the firm support of 1.3175, the price gapped to the upside, then rallied until the 1.3624 high.
Still, if the first next level of importance was validated as support by the gap, 1.3268, respectively, the next one, 1.3515, went along with the bears, printing a gap toward the downside.
This caused a drop that was very well played out by the bulls, as they limited it to the 1.3187 low.
So, as long as 1.3268 remains support, 1.3392 is the next area to be checked as support by the bulls. If this happens, then they may close the last gap and head for 1.3515. If 1.3268 cedes, it is backed by 1.3175.

Levels to keep an eye on:

D1: 1.3261 1.3502 1.3619 1.3000
H4: 1.3268 1.3392 1.3515 1.3175

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Original from: www.earnforex.com