(MENAFN- DailyFX) To receive Michael's analysis directly via email, please
testing range highs ahead of major US/UK event risk Check out our 3Q GBP/USD projections in our Join Michael for Live Weekly Strategy Webinars on GBP/USD Daily Chart
Technical Outlook:This week's highlighted a constructive bias in cable while above the 1.3020 confluence support zone as price continues to trade within this broad median-line formation. Heading into majorevent risk over the next 72 hours the focus is on a break of the late-October range between 1.3020-1.3338. A downside break of this key range would invalidate the longer-term up-trend with such a scenario eyeing initial support objectives at 1.2854.
New to Forex? Get started with this
GBP/USD 120min Chart
Notes:A closer look at price action highlights a near-term ascending formation extending off the late-October lows with price struggling just below the 50-line in early US trade. Note that we've been marking some divergence into this high and suggests the pair may be vulnerable for a near-term pullback. That said, the focus remains higher while within this formation heading into the open of November trade.
Interim support rests with the median-line (~1.3250) backed by 1.3221 areas of interest for near-term exhaustion. A breach higher eyes subsequent resistance objectives at 1.3338 and 1.3381/93. A close above that threshold is needed to fuel the next leg higher targeting the 61.8% retracement at 1.3417 & 1.3482.
Why does the average trader lose?
Bottom line: I'll be looking for opportunities to fade weakness over the next few days. Keep in mind there is a ton of event risk on tap, starting with the later this afternoon. It's Super Thursday in the UK tomorrow with the release of the BoE rate decision & the quarterly inflation report likely to fuel increased volatility in the Sterling crosses. Also note that we are waiting on President Trump's pick for the new Fed Chair and the announcement is likely to drive price action as markets weigh the implications for the future path of monetary policy. We wrap-up the week with U.S. Non-Farm Payrolls on Friday- things are about to get very interesting.
Join Michael on Friday for his bi-weekly Live Webinar on the Foundations of Technical Analysis-
A summary of shows traders are net-long GBPUSD- the ratio stands at +1.01 (50.3% of traders are long) Weak bearishreading Long positions are 13.4% lower than yesterday and 11.1% lower from last week Short positions are 7.1% higher than yesterday and 8.6% higher from last week We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBPUSD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week and recent changes in sentiment warn that the current GBPUSD price trend may soon reverse higher despite the fact traders remain net-long. See how shifts in GBP/USD retail positioning are impacting trend-
---
Relevant Data Releases
Check out this week's
Other Setups in Play
- Written by Michael Boutros, Currency Strategist with DailyFX
Follow Michael on Twitter or contact him at .
MENAFN0111201700760000ID1096028353
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.