GBP/USD bounces off 1.5907 and posts a bullish reversal Tuesday; more work to do for bulls

FXstreet.com (Barcelona) - GBP/USD bulls are benefiting from US dysfunction early this week as the cross reversed higher Tuesday on a lack of solutions from US politicians.

GBP/USD traders get big British data, big US data and more big bufoonery from DC on Wednesday

The GBP/USD ended a volatile session just off the session highs and well off of the session low of 1.59141. The bullish reversal clearly resulted from DC-induced Dollar weakness.

GBP/USD traders will get to trade around monthly British employment data early in the session as well as US TIC Flows, the US NAHB Housing Market Index and the US Fed Beige Book Survey later in the session.

Technical outlook for GBP/USD

Technicians say that GBP/USD bounced successfully off of key “correction support” at 1.5907. The next two possible supports below that are 1.5884 and 1.5841. Short-term resistance for the cross comes in at horizontal line at 1.6000 and then the 10/8 high at 1.6123. Elliott Wave technicians say GBP/USD is likely in the early stages of wave 5 higher with a projected target of 1.6432.