GBP/USD
Initial downside was limited yesterday and with buyers again below the 13 day moving average, a 4th up day in a row resulted. This consolidated CABLE above the key avg but almost half of initial upside was reversed into the close as overbought extremes began to unwind. Selling is not yet deep enough to provide strongly negative signals but there is scope for a retest of the 13 day line. In view of this our call is to Sell from the open but also on a Rally to 1.6638. The risk is 1.6666 with an immediate target of 1.6593. A move through that point focuses on 1.6555, yesterday's low, or even an overshoot to 1.6529.
The risk is that selling pressure is weaker than currently assessed – signalled above 1.6666, Mar 17th top, towards 1.6718.
GBP/CHF
Bullish signals for GBPCHF on the week are being confirmed, investors buying the cross on Thursday to post a 3rd higher daily low and high in a row and a gain of ¾ Big Fig on the day. A sequence of lower weekly highs has been ended and prices are trading above their 200 day average rate, which is positive for sentiment. However, although the rally may be corrective and it has stalled near the 100 day average, with no sign yet that demand is ending, the outlook for Friday is to buy on the open and at 1.4720, with a stop loss at 1.4702, yesterday’s afternoon low. Targets are to 1.4752, this week’s and the 7th March highs, 1.4790 and then towards 1.4869, this month’s top.
GBP/JPY
The end to a small sequence of higher daily lows turned Thursday’s signals for GBPJPY to bearish. Contrary to these however, investors continue to buy dips from close to the 100 day average rate, sentiment recovering yesterday to close modestly higher on the day. Signals are not strong and this week’s gains could be corrective below 170.68, a 50% recovery to this month’s losses. However, with no sign yet that demand is ending, the outlook for Friday is to buy on the open and at 169.22, yesterday’s opening trade, with a stop loss at 168.85, this week’s 4 hour bull trend. Targets are to 170.24, 170.77, the 13th March open and then towards 171.61, the high trade for the same day.
FTSE 100
A daily Spring Hammer at last week’s 6 week FTSE low has signalled improving sentiment. However, although the rally stalled on Wednesday, the absence of a sell signal left yesterday’s signals neutral. These were confirmed, as sentiment traded sideways inside a very small 36 Pt range for a modest up-day. Signals aren’t strong, but a small sequence of higher daily lows leaves a cautiously bullish bias and the outlook for Friday is to buy on the open and at 6520.0, with a stop loss at 6498.5, Wednesday’s low. Targets are to 6556.5, Wednesday’s open, 6587.5, Wednesday’s high and then towards 6605.0, a daily bear trend.
