British Pound: USD/GBP (GBP=X) possibility of going much higher
The British pound has rallied significantly during the week, breaking above the 1.30 level. This level is not only psychologically important due to the fact that it is a large, round, big figure, but it’s also the top of the bullish flag that we had seen recently. By breaking above here, it makes quite a bit of sense that the market goes higher. This is a major barrier that finally got taken out, and that of course will have a lot of traders excited. Ultimately, this is a pair that I believe goes to the 1.33 level, and then eventually the 1.40 level given enough time. The measurement of the bullish flag suggests that a move to the 1.38 level is certainly possible.
Keep in mind that we have an election next week, and that of course will come into play and have a lot to do with what happens with the British pound next. That being said though, if we can get a Tory Parliament, it’s likely that the British will be leaving the European Union and we will finally get some type of certainty in this marketplace. All things being equal, certainty is the one thing that the British pound needs to go going forward, and with that being the case it’s certainly worth noting that traders will continue to look at this is a “buy on the dips” type of situation. Overall, I think that unless we were to turn around a break down below the 1.2750 level, there’s no reason whatsoever to think about shorting.
Overall, the bias in prices is: Upwards.
By the way, prices are vulnerable to a correction towards 1.27.
The projected upper bound is: 1.33.
The projected lower bound is: 1.30.
The projected closing price is: 1.31.
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 27 white candles and 21 black candles for a net of 6 white 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 90.5002. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 14 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 69.94. This is not a topping or bottoming area. However, the RSI just crossed below 70 from a topping formation. This is a bearish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 0 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 126.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 14 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 3 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed down -0.000 at 1.313. Volume was 98% below average (consolidating) and Bollinger Bands were 18% narrower than normal.
Open High Low Close Volume___
1.314 1.315 1.311 1.313 2,263
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.30 1.28 1.27
Volatility: 6 10 9
Volume: 88,861 102,970 129,101
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 3.4% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. 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 0 periods.