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British Pound
Ticker: GBP=
Price: $1.3410
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The next one to two weeks will prove critical in determining whether the Pound-Dollar exchange rate is able to break into the next phase of its uptrend, according to a new analysis of the market’s technical setup.
The GBP/USD has been forming a classical head & shoulder reversal pattern. Looking at the chart, we see that 1.35 is a major resistance level. With a new medium-term momentum indicator bottom, a new attempt has started to resolve the reversal pattern and enter a sustainable recovery.
The Pound has been in an uptrend against the U.S. Dollar since September, going from 1.2680 to current levels above 1.33.
Price action over the past week has seen the exchange rate constantly knocking its head on the ceiling at 1.34, with all attempts being rebuffed by sell orders, betraying a market that is not yet convinced Sterling has the legs to sustainably break higher.
GBP/US Dollar Exchange Rate
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GBP/US Dollar FX Polls
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Technical Indicators
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.
Candlesticks
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 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 Indicators
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.
Stochastic Oscillator
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 68.0193. This is not an overbought or oversold reading. The last signal was a sell 3 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 65.64. 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 75 period(s) ago.
MACD
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 19 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed down -0.001 at 1.341. Volume was 88% below average (consolidating) and Bollinger Bands were 30% narrower than normal.
Open High Low Close Volume 1.342 1.343 1.340 1.341 16,988
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: 5 10 14 Volume: 131,067 149,467 134,642
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.
Summary
FOREX GBP= is currently 5.3% 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 35 periods.