Interesting price action on cable, traders...
GBP/USD:
The British pound rose against its US counterpart Tuesday as concerns over a no-deal Brexit eased. UK PM May stated the UK needs a further extension of Article 50, and would end when a deal has been passed. The PM further added she will reach out to UK opposition leader Corbyn to help break the Brexit logjam.
After clocking a session low at 1.3013, the GBP/USD firmly brushed aside 1.31 and nearby February’s opening level at 1.3108 on the H4 timeframe. Beyond here, traders likely have their crosshairs fixed on a run towards 1.32ish, which happens to merge with a 127.2% ABCD (black arrows) bearish pattern. What’s also notable from a technical standpoint is trend line support-turned resistance (extended from the low 1.2373) out of the daily timeframe fusing closely with 1.12.
The story on the weekly timeframe shows the unit trading from supply drawn from 1.3472-1.3204. Since the end of February this has been home to many traders as price flips between gains/losses. The next obvious downside target from here falls in around demand at 1.2365-1.2615.
Areas of consideration:
A retest at 1.31 as support today could unlock the doors to a short-term buying opportunity, targeting 1.32 on the H4 timeframe. With psychological numbers prone to fakeouts, waiting for additional confirmation to form is recommended. Having this provides traders a way of identifying buyer intent as well as offering entry and risk levels to work with (based on the chosen confirmation method).
In the event our analysis is correct and the market observes a run towards 1.32, this number, in light of its surrounding confluence highlighted above, sets a strong foundation for a sell from this region. Like above, though, psychological numbers are prone to fakeouts and, therefore, waiting for additional confirmation to form is also recommended.
Today’s data points: UK Services PMI; US ADP Non-Farm Employment Change; US ISM Non-Manufacturing PMI.
The British pound rose against its US counterpart Tuesday as concerns over a no-deal Brexit eased. UK PM May stated the UK needs a further extension of Article 50, and would end when a deal has been passed. The PM further added she will reach out to UK opposition leader Corbyn to help break the Brexit logjam.
After clocking a session low at 1.3013, the GBP/USD firmly brushed aside 1.31 and nearby February’s opening level at 1.3108 on the H4 timeframe. Beyond here, traders likely have their crosshairs fixed on a run towards 1.32ish, which happens to merge with a 127.2% ABCD (black arrows) bearish pattern. What’s also notable from a technical standpoint is trend line support-turned resistance (extended from the low 1.2373) out of the daily timeframe fusing closely with 1.12.
The story on the weekly timeframe shows the unit trading from supply drawn from 1.3472-1.3204. Since the end of February this has been home to many traders as price flips between gains/losses. The next obvious downside target from here falls in around demand at 1.2365-1.2615.
Areas of consideration:
A retest at 1.31 as support today could unlock the doors to a short-term buying opportunity, targeting 1.32 on the H4 timeframe. With psychological numbers prone to fakeouts, waiting for additional confirmation to form is recommended. Having this provides traders a way of identifying buyer intent as well as offering entry and risk levels to work with (based on the chosen confirmation method).
In the event our analysis is correct and the market observes a run towards 1.32, this number, in light of its surrounding confluence highlighted above, sets a strong foundation for a sell from this region. Like above, though, psychological numbers are prone to fakeouts and, therefore, waiting for additional confirmation to form is also recommended.
Today’s data points: UK Services PMI; US ADP Non-Farm Employment Change; US ISM Non-Manufacturing PMI.
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