The Pound jumped yesterday and broke the resistance specified in yesterday’s report 1.5490, and reached the first suggested target for this break at 1.5575 successfully. After it topped 10 pips above our target then dropped hard for more than 100 pips. This is a sign of exhaustion, and that breaking 1.5490, which we believe is very important, only had a short term effect on the price behavior. This morning we approached a critical short term support level which is Fibonacci 61.8% for the latest rise from 1.5347 on Monday to 1.5585 yesterday. This level which is at 1.5438 is the most important support for now. The drop stopped just 10 pips above it a few hours ago, and if is broken, then the Pound has already topped medium term yesterday at 1.5585, and it will continue its drop targeting the very attractive 1.5326, and at a later time 1.5249. On the other hand, the Pound should break the resistance
1.5533 to keep the chances of another jump alive. If it succeeds, we expect it to target medium term important levels: 1.5646 & 1.5728.

Support:

• 1.5438: short term Fibonacci 61.8% level.

• 1.5326: Aug 31st low.

• 1.5249: Jul 23rd low.

Resistance:

• 1.5533: short term 61.8% Fibonacci level.

• 1.5646: Fibonacci 50% for the whole drop from Aug 6th top.

• 1.5728: Fibonacci 61.8% for the whole drop from Aug 6th top.