GBP/USD: I could have chosen the easy solution and just said a neutral market going sideways within the 1.2000 – 1.2800 area with the Long MA (currently 1.3060) heading down as resistance and the nearing the market whilst the Medium MA (currently 1.2458) is mixed among the action and currently acting as support plus the old 50% Fib at 1.2447 from the original Sep 2016 – Oct 2016 move is in there as support as well and a more recent 50% Fib at 1.2376 also acting as new support.
All this would be true but there was one glaring feature made last Thursday that deserves attention. We had a key reversal down on the daily chart (marked above), possibly forming a double top over the end of Jan and beginning of Feb and mirroring the action back in early Dec 2016 when we saw prices fall and form the 1.1977 low in Jan. It is too early to say if this is the case, but Friday’s action was encouraging by expanding the recent range and resting on that whole load of support between 1.2470-1.2376.
Personally, it seems to me that the market had recently tried once again up to the resistance 1.2775 – 1.2812 and seemingly failed…again! It would therefore seem likely that we may therefore try lower, hence the overall bullet point being bearish but with a question mark.
Support is at 1.2470, 1.2458, 1.2447, 1.2424, 1.2376, 1.2282, 1.2210 and 1.2079(dynamic).
Resistance is at 1.2587(dynamic), 1.2683, 1.2707, 1.2775, 1.2812, 1.2863, 1.2912 and 1.3060(dynamic).
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