British Pound: USD/GBP (GBP=X) traders focus on the Brexit
The British pound fell during most of the trading session on Monday as traders ponder the idea of breaking above the 200 day EMA. Regardless of what you believe about the Brexit situation, it’s relatively obvious that the market has got ahead of itself in the last couple of days.
While there will continue to be a lot of noisy trading in this general vicinity, a break down below the 1.25 level could open up the door to a recapturing of the 50 day EMA by the sellers. The 200 day EMA of course is a longer-term signal as to trend, so that will be paid close attention to as well.
To the upside, the 1.28 level will offer a significant amount of resistance that will be difficult to overcome, and as a result a break above there would have to be paid attention to for a potential longer-term move. If we did break above there, then the market is almost certainly going to go looking towards the 1.30 level.
It will almost need some type of good news to make that happen though, because quite frankly we have gone so far in such a short amount of time is difficult to imagine a scenario where traders have that much more juice to push the market to the upside. At the very least, a pullback is needed over the next couple of days as markets can’t go in one direction forever.
Overall, the bias in prices is: Upwards.
By the way, prices are vulnerable to a correction towards 1.24.
The projected upper bound is: 1.28.
The projected lower bound is: 1.24.
The projected closing price is: 1.26.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 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 83.6922. 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 64.46. 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 43 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 163.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. 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 0.001 at 1.261. Volume was 100% below average (consolidating) and Bollinger Bands were 36% wider than normal.
Open High Low Close Volume___
1.261 1.262 1.260 1.261 128
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.24 1.23 1.27
Volatility: 15 12 10
Volume: 94,992 113,287 142,204
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 0.8% below 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 1 periods.