Forex Trading Library

GBPUSD – Close to exhaustion

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Monthly: Moved higher from the 2016 low of 1.1905. Levels close to be bespoke resistance at 1.4390 found sellers. Aprils price action formed bearish Outside Bar, often an indication that the rally (correction) has come to an end. Follow through selling pressure has resulted in GBPUSD trading to the lowest level in 6 months. Reverse trend line support is located at 1.2855

Weekly: After completing a bullish Elliott Wave pattern (5-waves) a bearish Outside Week was posted from the high (1.4377). Six consecutive negative weekly performances have resulted in GBPUSD breaking the channel formation to the downside. Reverse trend line resistance is located at 1.3857. The weekly Ichimoku Cloud is stalling the selloff.

NOTE: the 61.8% pullback level (from the 1.1897-1.4364 move) is located at 1.2848. This is close to reverse trend line support (monthly) and is the prime medium-term target for the long-term outlook

Daily: Signals for sentiment are now at oversold extremes. With a 261.8% extension level located at 1.3176, we look for further losses to be limited. Preferred trade is to buy into dips.

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