British Pound: USD/GBP (GBP=X) Building Support Against Greenback

British Pound: USD/GBP (GBP=X) Building Support Against Greenback

British Pound: USD/GBP (GBP=X) Building Support Against Greenback

The British pound has gone back and forth during the trading session on Tuesday, as we continue to see a lot of interest around the 50 day EMA. Furthermore, we are dancing around the 1.30 level, so it looks very likely that this level will continue to attract buying pressure. We are sitting at the 50 day EMA, and that suggests that we are going to eventually find enough buying pressure to turn this market to the upside. We are sitting on top of the previous bullish flag, so that of course is an area that should continue to cause support in general.

If we can break above the gap from the Monday session, it’s likely that the market will turn around and go to the upside. At this point, it should send the market quite a bit higher, perhaps reaching towards the 1.35 level given enough time. Having said that though, it doesn’t mean that it will be easy to accomplish, just that it is the longer-term target. Ultimately, I do believe in buying dips as they offer plenty of value, but I also recognize that the biggest component to making money here is going to be using a lot of patience. I would build up positions with very little bits and pieces, understanding that it’s more or less a “core position.” I have no interest in trying to short this pair, at least as long as we can stay above the 1.28 handle. We will continue to have a lot of headline risks, but in the end it does look bullish.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 1.32.

The projected lower bound is: 1.28.

The projected closing price is: 1.30.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 25 white candles and 24 black candles for a net of 1 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 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 26.3567. This is not an overbought or oversold reading. The last signal was a sell 8 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 46.82. 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 21 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 -97. This is not a topping or bottoming area. The last signal was a buy 0 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 sell 5 period(s) ago.

Rex Takasugi – TD Profile

FOREX GBP= closed up 0.001 at 1.302. Volume was 6% below average (neutral) and Bollinger Bands were 26% narrower than normal.

Open     High      Low     Close     Volume___
1.302 1.304 1.298 1.302 98,225
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 1.31 1.30 1.27
Volatility: 7 9 9
Volume: 104,381 97,665 118,247

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 2.6% above its 200-period moving average and is in an downward 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 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 3 periods.

The following two tabs change content below.
HEFFX has become one of Asia’s leading financial services companies with interests in Publishing, Private Equity, Capital Markets, Mining, Retail, Transport and Agriculture that span every continent of the world. Our clearing partners have unprecedented experience in Equities, Options, Forex and Commodities brokering, banking, physical metals dealing, floor brokering and trading.