Weak USD Rallies GBPUSD The USD has weakened significantly as...

Weak USD Rallies GBPUSD

The USD has weakened significantly as the Federal Reserve talks down the USD and the market rumors about QE3 (a third round of quantitative easing in the United States) gather steam. After making a low at 1.5770, GBPUSD has actually been bullish.

1. Another bounce off of the 1.5750 midterm support level
2. A close above the 61.8% Fibonacci retracement level at 1.5880 despite breaking below it.
3. A new high above 1.6150

To confirm the bullishness, a break and hold above the 61.8% Fibonacci retracement level at 1.6185 would be need with price completing the quarter to 1.6250. If this doesn't develop, we could see corrective action back towards 1.6000, the 61.8% Fibonacci level of today's rally.

Ultimately, cable looks bullish above 1.6000 despite the bear trend since late April.

Full disclosure