In the drop to 1.5650 yesterday, the uptrend line from May essentially held as did the 9/30 low of 1.5670. Given all the gloom about the UK possibly doing more quantitative easing, I'm a little surprised but everyone seems to be on a rally against the buck today. The C wave of the ABC correction could still be ongoing which would cause a push to 1.6391 (.618 of the A wave). As those who follow me know, there's still that daily bull flag with a target of 1.6461. Still, the break below 1.5749 convinced a lot of traders a top has been made at 1.6107. We'll see.
A move down will find support at 1.5650, 1.5627 (a former daily speed line) and the psychological 1.55, below which is probably a return to 1.5297. If the pair continues to rally, expect resistance at 1.5879 (today's high), 1.5997 and 1.6107.
Here's the daily chart:
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