GBP/USD getting over-bought

GBP/USD has moved in a nice upward trend but seems to be touching the top of current range and therefore long term traders will be interested in buying GBP/USD once it takes some retrace. The first retracement target can be seen towards 1.5750 level. One the traders got a chance to buy GBP/USD around 1.5750 level, they will be targeting 1.5910 level and hope that the moment carries GBP/USD towards an important 1.6000 level. Since the market is already quite over bought therefore an extended upward move is not expected. On the lower side, dip below 1.5750 level will expect an extended move towards 1.5600 level.

Looking at the moving averages used in daily charts, it can be seen that the market is comfortably above all the three moving averages and for entry, traders will look for entry points for dip towards short term moving average, around 1.5750 level and in case the move the extended (which is more expected), the nest entry level will be long term and medium term moving averages crossing each other around 1.5600 level. RSI is approaching 70 in daily charts and seems to suggest that sooner or later, GBP/USD will look to take an extended dip.

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