H1 double-bottom might enter view today...

19 thg 4, 2020

GBP/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Although March clocked levels not seen since the 1980s, ahead of a 127.2% Fib ext. level at 1.1297, price staged an impressive recovery and regained approximately 80% of the month’s losses.

Support at 1.1904/1.2235 remains relevant in April, despite recent moves to said lows. Nearby resistance can be seen in the form of a trendline formation (1.7191).

Concerning the primary trend, lower peaks and troughs have decorated the monthly chart since early 2008.

Daily timeframe:

Partially altered from previous analysis -

Demand-turned supply at 1.2649/1.2799, an area that aligns with a 200-day simple moving average (SMA) at 1.2648, remains a dominant fixture to the upside on this timeframe.

Demand at 1.2509/1.2372 currently houses price as GBP/USD pencilled in a modest gain and snapped a two-day losing streak Friday. Dropping beneath the said demand shifts focus to 1.2212/1.2075.

H4 timeframe:

Partially altered from previous analysis -

Orders around supply at 1.2622/1.2517 remain fragile, following last Tuesday’s breach to a high of 1.2647. In spite of the recent pullback to lows at 1.2407, the break of 1.2622/1.2517 potentially builds a foundation to explore higher levels. Limited supply, according to chart studies, is evident on this timeframe until reaching 1.2854/1.2804, bringing with it a 78.6% Fib retracement level at 1.2809 (blue) and a 127.2% Fib ext. level at 1.2799.

H1 timeframe:

Supply at 1.2526/1.2510, an area that’s capped upside on three occasions in recent trade, made another showing at the tail end of Friday’s session, following a dominant run north of 1.24.

Located just above the 1.25 handle and mixing with the 100-period simple moving average (SMA) as well as being glued to the underside of H4 supply underlined above at 1.2622/1.2517, this positions the current H1 supply as a technically appealing base.

A run lower from supply has 1.2450 on the radar, whereas moves higher has the 1.2574 high offering possible resistance, with 1.26 following close by.

Structures of Interest:

Long term:

Monthly price is seen holding north of support at 1.1904/1.2235, alongside daily price displaying signs of strength from demand at 1.2509/1.2372.

Short term:

H1 supply at 1.2526/1.2510 may be on the watchlists for some traders today, hoping for another rejection. The concern, however, is that buying pressure from the monthly support area at 1.1904/1.2235 and daily demand at 1.2509/1.2372, alongside H4 supply at 1.2622/1.2517 echoing a fragile tone, may see higher prices unfold.

Friday’s high at 1.2522 is significant on the H1 timeframe (red arrow). A break above this base will (traditionally) confirm the H1 double-bottom support from 1.2408. The take-profit target, measured by taking the distance between the lowest trough and the corresponding peak (1.2408/1.2522) and adding this to the breakout point, shows price could potentially surpass 1.26 and test last Tuesday’s high at 1.2647 (black arrows), essentially drawing price action back to daily demand-turned supply at 1.2649/1.2799.