British Pound: USD/GBP (GBP=X) rises up to key June highs
The Pound-to-Dollar rate will be trading at around 1.2738 at the start of the new week, after rising 1.2% in the previous week. Studies of the charts suggest that the exchange rate is likely to continue rising over the next five days.
Recently, however, the exchange rate has started diverging with the RSI momentum indicator in the lower panel, and this is a bearish sign the pair could rotate and turn lower.
Whilst not necessarily a reversal sign, the divergence indicates the pair will probably pull-back over the next few sessions and unfold sideways between roughly the mid 1.26s and 1.27s for a time until it eventually breaks higher.
The pair has now almost reached the key June 7 highs at 1.2760. If it breaks above this level on a closing basis it would provide a critical bullish signal and suggest a continuation up to a target at 1.2900.
The daily chart shows the pair completing a possible double bottom reversal pattern, which indicates the likelihood of more upside to come.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1.29.
The projected lower bound is: 1.26.
The projected closing price is: 1.27.
A white body occurred (because prices closed higher 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 19 white candles and 31 black candles for a net of 12 black candles.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
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 94.1178. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 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 53.17. 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 16 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 91. This is not a topping or bottoming area. The last signal was a buy 3 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 2 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed up 0.000 at 1.275. Volume was 88% below average (consolidating) and Bollinger Bands were 39% narrower than normal.
Open High Low Close Volume___
1.272 1.275 1.272 1.275 18,170
Short Term: Overbought
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.27 1.28 1.29
Volatility: 8 7 10
Volume: 121,194 139,552 172,303
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 1.4% below its 200-period moving average and is in an downward trend. Volatility is 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 28 periods.