GBP - return of the bull?

I last wrote on GBP on the great possibility for the return of the bull on late February. Market has been range bounding which was confirmed the lowly ADX of below 20's. I also placed in several conditions that should be met before we can see the return of the bull.

Those conditions were the MACD must go above its zero signal line; D+ goes above its previous peak and prices go above 1.4984 which was its last factal point. Currently all te above have been met. From the daily chart which I have drwn 1 horizontal line to mark out its recent range and also I have drawn another up sloping line to connect up its recent lows. This is what we would call a ascending triangle chart formation which is usually bullish. Yesterday closing price had broken up above it. The most promising part about this chart is its ADX which is also breaking out above 20's and rising. This is effectively telling us that a trend in this market may be in progress.


Meanwhile its weekly chart's ADX has been falling above both the D-and D+ would tell us that its prioor bear trend may be over. But I note the MACD though positive and rising but it is still relative far from its zero signal line which is not too assuring yet. And we would need to see this Friday's closing price to hold above the Bollinger Band top in order to give us more assurances.

The upside targets to watch out for are: 1.547; 1.609 and 1.668. Place your initial stop at 1.45.

Below is an extracts from some fundamental reasons as to why GBP would rally. These are written by traders who actually have their own real $$$ on the table and not those who toy with other people's money type:-

The British Pound has steadily climbed since making lows in mid-March, fueled by the stock market rally. The rise in equity prices has sparked a repatriation of funds to the UK, as investors look for investment opportunities at home, instead of parking funds in US Dollars. Forex traders have also become bullish on the Pound versus the Euro. The Eurozone faces very similar economic challenges to the UK and there has been a great deal of in-fighting between the countries that make up the union, which could delay government response to the crisis. Fundamentally, Britain has shown some signs of stabilization in the housing market and in manufacturing, whereas Continental Europe appears to be on the downswing. Yields on UK debt remain attractive when compared to similar treasuries in the US, which could bring in foreign investment. There are still plenty of challenges facing the UK banking system and, much like the US, the government has spent billions instituting rescue packages for banks. This may cause traders to be skittish and jump ship at the first signs of trouble. The month-long rally in the global equities market has been impressive and has somewhat eased investors' worst fears. However, if the rally reverses course, the Pound and other major currencies may fall out of favor, as investors once again flock to the relative safety of the Dollar.