British Pound: USD/GBP (GBP=X) don’t be surprised if the volatility picks up
The British pound has fallen during the trading session on Wednesday, reaching towards the vital 1.30 level. We have broken below this level before though, so it’s not exactly an possible that we continue to go lower. In general, we obviously have the Brexit to worry about which of course moves the British pound in and of itself. Beyond that, we also have the nonsense going on between the Americans and the Chinese, which of course causes a lot of concern.
Looking at this pair, if we break down below the 1.30 level, then we probably go down to the 1.29 level. That’s an area that shows a lot of support previously, so at that point we may have some value hunting going on. Ultimately, this is a marketplace that has a lot of noise and news around it, so it’s going to be difficult to hang on to the position for longer-term, and therefore you may find it beneficial to ignore the British pound altogether.
I recognize that a lot of the headlines are around the British pound in Brexit, but that causes a lot of machine based trading which doesn’t necessarily use logic and may simply move due to different words crossing newswires. Given enough time though, I do believe that we are at historically cheap levels right now and it’s very likely that we will eventually go higher. In the meantime, finding value on dips might make sense, but only in small bits and pieces.
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.
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 30 black candles for a net of 11 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 22.8072. This is not an overbought or oversold reading. The last signal was a sell 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 47.02. 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 50 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 6. This is not a topping or bottoming area. The last signal was a sell 2 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 6 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed up 0.000 at 1.301. Volume was 91% below average (consolidating) and Bollinger Bands were 28% narrower than normal.
Open High Low Close Volume___
1.301 1.302 1.300 1.301 14,659
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.30 1.31 1.30
Volatility: 9 10 10
Volume: 128,423 166,339 177,038
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 0.4% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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 2 periods.
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