British Pound News
The British pound rallied significantly during the trading session on Tuesday to break above the 1.34 level which has been resistance over the last week or so. It looks as if the market is trying to go to the psychologically and structurally important 1.35 level as we wait to see whether or not the EU and the UK can get it together. Market participants are starting to price in a high probability of a Brexit deal, so the British pound continues to be rather supportive.
It appears that the 1.33 level should be supportive, so it is likely that traders will buy into pullbacks – unless the Brexit situation suddenly gets ugly. Even if it does, I suspect that there will be plenty of value hunters down there trying to pick up value in the British pound, as it has been so beaten down over the last couple of years. By some estimates, the British pound is undervalued by roughly 15% of its normal weight.
The size of the candlestick is somewhat impressive, considering how small some of the other ones were over the last couple weeks. Now we are simply waiting for a decision over the next day or two as to where to go next – not just regarding the British pound, but all things Brexit-related. If we do break above the 1.35 handle, the market is likely to go much higher, perhaps reaching towards the 1.3850 level given enough time. However, it is very likely that what we will see is a move towards the 1.40 level. While this is a market that will go much higher over the longer term, it will continue to be difficult to handle some of the volatility eventually. As far as selling is concerned, I have no interest in doing so. The British pound has been so resilient over the last few months, and every time we get sellers, people come in trying to pick up value as so many people are trying to get in ahead of the breakout.
GBP/US Dollar Exchange Rate
Today’s Forex Rates
GBP/US Dollar FX Polls
Overall, the bias in prices is: Upwards.
By the way, prices are vulnerable to a correction towards 1.31.
The projected upper bound is: 1.36.
The projected lower bound is: 1.32.
The projected closing price is: 1.34.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 62.7707. This is not an overbought or oversold reading. The last signal was a sell 4 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 61.71. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 76 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 0 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed up 0.001 at 1.337. Volume was 84% below average (consolidating) and Bollinger Bands were 33% narrower than normal.
Open High Low Close Volume 1.336 1.337 1.335 1.337 22,253
Technical Outlook Short Term: Overbought Intermediate Term: Bullish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1.33 1.31 1.27 Volatility: 6 10 14 Volume: 129,696 148,921 134,765
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX GBP= is currently 5.0% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods.
There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into GBP= (mildly bullish). Our trend forecasting oscillators are currently bullish on GBP= and have had this outlook for the last 36 periods.