British Pound: USD/GBP (GBP=X) unable to sustain a recovery

British Pound: USD/GBP (GBP=X) unable to sustain a recovery

British Pound: USD/GBP (GBP=X) unable to sustain a recovery

Following a broad slump last week, the British Pound to US Dollar (GBP/USD) exchange rate has been unable to sustain much of a recovery today as the US Dollar remains resilient on the back of market safe haven demand, as well as some of last week’s US data being better than forecast. The Pound’s rebound was also limited, as uncertainties in UK politics and Brexit clouded the British currency’s outlook.

After opening last week at the level of 1.2471, just below the two month high of 1.2567 seen on the 20th, GBP/USD spent the week tumbling. Ultimately, GBP/USD closed the week at the level of 1.2290, just above Friday’s lowest level in around half a month.

Today so far, GBP/USD has rebounded slightly as the Pound attempts to recover from last week’s plunge, but the pair’s gains have been limited. At the time of writing, GBP/USD was trending close to the level of 1.2305.

Investors are hesitant to buy the Pound too much against the US Dollar, as market-wide uncertainties have made safe haven currencies like the US Dollar more appealing.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 1.25.

The projected lower bound is: 1.21.

The projected closing price is: 1.23.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.

A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).

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 8.7133. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 6 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 46.59. 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 32 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 -106.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 6 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 3 period(s) ago.

Rex Takasugi – TD Profile

FOREX GBP= closed up 0.001 at 1.229. Volume was 19% below average (neutral) and Bollinger Bands were 7% wider than normal.

Open     High      Low     Close     Volume___
1.229 1.235 1.227 1.229 98,225
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 1.24 1.23 1.27
Volatility: 9 10 9
Volume: 111,790 118,330 144,526

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 3.4% below its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. 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 25 periods.

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