British Pound: USD/GBP (GBP=X) promises to be a busy week
GBP/USD posted huge gains last week, climbing 2.2 percent. It promises to be a busy week. The U.K. releases CPI and retail sales, and parliament will hold another vote over Brexit. Central banks will also be in focus, with the BoE and Federal Reserve expected to maintain the benchmark rate.Here is an outlook for the highlights of this week and an updated technical analysis for GBP/USD.
Shayne Heffernan said “the GBP will be a big winner from BREXIT cutting ties to the EU will lift the GBP to old highs”.
There was a flurry of votes in parliament last week, capping what was an extraordinary week in British politics. Lawmakers rejected the government’s withdrawal bill, called for a hard Brexit to be removed as an option, and voted in favor of delaying Britain’s departure from the European Union. The pound jumped as markets were pleased that the no-deal scenario is hopefully off the table. Still, plenty of uncertainty remains. Will the E.U. accept an extension? If so, for how long? Parliament remains deeply divided, and with Prime Minister May’s standing badly battered, it’s unclear how Brexit will unfold.
Overshadowed by the Brexit drama, the U.K. posted some strong numbers. The monthly GDP release rebounded in January, with a strong gain of 0.5%. As well, manufacturing production climbed 0.8% in January, after three straight declines.
Overall, the bias in prices is: Upwards.
By the way, prices are vulnerable to a correction towards 1.30.
The projected upper bound is: 1.35.
The projected lower bound is: 1.31.
The projected closing price is: 1.33.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 3 white candles and 6 black candles for a net of 3 black candles. During the past 50 bars, there have been 23 white candles and 25 black candles for a net of 2 black candles.
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 78.2874. This is not an overbought or oversold reading. The last signal was a buy 4 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 59.38. 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 11 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 72. This is not a topping or bottoming area. The last signal was a sell 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 buy 0 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed up 0.005 at 1.329. Volume was 9% above average (neutral) and Bollinger Bands were 1% wider than normal.
Open High Low Close Volume___
1.324 1.330 1.320 1.329 199,536
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.32 1.30 1.30
Volatility: 16 11 11
Volume: 186,225 173,293 179,102
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 2.4% 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 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 2 periods.
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