British Pound: USD/GBP (GBP=X) reaching towards the 1.2550 level
The British pound fell significantly during the trading session on Wednesday, reaching towards the 1.2550 level. That’s an area that should continue to be of interest as we had recently bounced from just below. Obviously, the 1.25 level underneath will probably cause significant support due to the fact that it has not only rallied from that level previously, but it is also a large, round, psychologically significant figure.
To the upside, if we can break above the top of the candle stick for the trading session on Wednesday, it’s very likely that we will go looking towards the red line that I have drawn on the chart, roughly 1.28. This is a market that looks like it’s trying to find a bottom, perhaps due to the Federal Reserve looking to cut interest rates later. Unfortunately though, the British still can get the whole Brexit thing together, so this could be a bit of a laggard.
If we were to bounce from here and test that redline again, we could be looking at the beginning of an inverted head and shoulders, which could open the door to the 1.30 level. Obviously, this is going to be a longer-term trade, as this pair has a lot working against it. To the downside, if we were to break down below the 1.25 handle, the market probably goes looking towards the 1.2250 level, based upon historical charts. With the jobs number coming out on Friday and a major holiday between now and then, we should have an answer in the next few days.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 1.27.
The projected lower bound is: 1.24.
The projected closing price is: 1.26.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 20 white candles and 30 black candles for a net of 10 black candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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 7.8675. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 5 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 37.84. 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 23 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 -89. This is not a topping or bottoming area. The last signal was a buy 10 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 down -0.002 at 1.258. Volume was 33% below average (neutral) and Bollinger Bands were 33% narrower than normal.
Open High Low Close Volume___
1.259 1.260 1.255 1.258 102,528
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.27 1.28 1.29
Volatility: 5 7 10
Volume: 121,030 135,108 170,357
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 2.6% below 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 volume flowing into and out of GBP= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on GBP= and have had this outlook for the last 5 periods.