British Pound: USD/GBP (GBP=X) massive resistance barrier at 1.25
The British pound has pulled back a bit during the trading session on Wednesday as we continue to see a lot of concerns out there when it comes to risk appetite. The 1.25 level above is a massive resistance barrier and the first thing I would point out is that there has been a very resilient buying pressure underneath, turning the market back towards that level. However, it seems as if the 1.25 level is a bit of a “brick wall”, and therefore it should be noted that the market is probably going to continue to see a lot of negativity. Quite often, you will see something like this form and if this happens two or three days in a row, eventually exhaustion sets and then the market falls.
On the other hand, if we were to break above the 1.25 level it would be a massive breakout that people would be paying attention to, and therefore I would anticipate that a large amount of monetary flow would go running into the British pound. At that point, I would anticipate that the market would go looking towards the 200 day EMA above, and then perhaps even the 1.2750 level. However, the more time we spend just below the 1.25 level, the more likely it is that we see negativity jump into the market and exhaustion take over. If we do break down, which I look at as a breakdown of the Tuesday candle to the downside, this market will more than likely go looking towards 1.20 level rather quickly.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1.25.
The projected upper bound is: 1.28.
The projected lower bound is: 1.20.
The projected closing price is: 1.24.
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 21 white candles and 29 black candles for a net of 8 black candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
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 85.4015. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 7 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 50.10. 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 buy 7 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 78. This is not a topping or bottoming area. The last signal was a buy 7 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 buy 4 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed up 0.001 at 1.238. Volume was 76% below average (consolidating) and Bollinger Bands were 222% wider than normal.
Open High Low Close Volume___
1.237 1.241 1.237 1.238 26,110
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.21 1.27 1.27
Volatility: 21 21 13
Volume: 133,650 121,256 112,112
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 2.2% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of GBP= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on GBP= and have had this outlook for the last 59 periods.