British Pound Crosses:

1. GBP/JPY
2. GBP/CHF

GBP/JPY - Cable bulls remained on a roll after the managing to push the yen bulls above the psychologically important 200.00 figure and is currently setting their sights on the key 61.8 Fib of the 205.37-192.70 GBP rally, as a break above the will most likely see the cross crash through the heavy Japanese yen defenses and head toward the 201.56, a level marked by the March 18 daily spike high. A sustained momentum on the part of the sterling longs will most likely see the yen bulls head for the higher ground and try to mount defense around the 202.65, a defense line established by the key 78.6 Fib of the 205.37-192.70 GBP rally. An upward sloping channel adds validity to the cause of the pound longs as the price action has been dominated by the price channel since the middle of July. Indicators remain in a range trading mode with oscillators approaching oversold territory, while both MACD and momentum indicator's remain above the zero line.  

Key Levels, Technical Indicators & Carry Trade

GBP/CHF - Swiss Franc longs continued to pound cable bids as cross tumbled from its recent highs, while remaining confined to a large triangle, with the triangle lower boundary acting as a neck line for a large head and shoulder pattern that has been developing since April. As sterling bulls continue to have their horns handed back to them, a break below the 38.2 Fib of the 2.1471-2.3311 GBP rally will most likely see the cross tumble toward the 200-day SMA at 2.2507, right above the psychologically important 2.2500 handle. A further move to the downside will most likely see the GBPCHF head toward the 50.0 Fib of the 2.1471-2.3311 GBP rally at 2.2391. Indicators remain on the in favor of the cable longs with both MACD and momentum indicator above the zero line, while neutral oscillators give either side enough room to maneuver.

Key Levels, Technical Indicators & Carry Trade

Sam Shenker is a Technical Currency Analyst for FXCM.