GBP/USD Monthly Range-Break Appears Imminent

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GBP/USD Daily Chart

GBP/USD Price Chart - Daily Timeframe

Technical Outlook: The British Pound has forged out a monthly opening-range only next a 2017 high tighten during 1.3589 with halt support eyed during a 2018 high-day tighten during 1.3495. As discussed in this week’s Technical Perspective, anniversary tendencies are flattering complicated for Cable with a daily movement form also looking a bit exposed here. Ultimately, we’re looking for a mangle of this operation to countenance a near-term opinion with a broader disposition still weighted to a topside while within this multi-year descending pitchfork arrangement / 1.3320.

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GBP/USD 240min Chart

GBP/USD Price Chart - 240min Timeframe

Notes: A closer demeanour during cost movement highlights a due pitchfork fluctuating off a highs with cost resilient off a 50-line progressing today. We’ll preference vanishing strength while next a weekly open during 1.3575 with a mangle next 1.3456 changeable a concentration towards connection support during a median-line / 38.2% retracement during 1.3389.

A crack of a design weekly opening-range highs / 1.3589 would keep a broader long-bias in play with such a unfolding targeting successive insurgency objectives during a 2017 high during 1.3658 and a Brexit opening during 1.3675. Bottom line: a risk is reduce in argent though eventually a incomparable reversal would offer some-more auspicious long-entries while within a broader uptrend. Look for a mangle / tighten of a monthly opening-range to get things going.

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GBP/USD IG Client Sentiment

  • A outline of IG Client Sentimentshows traders are net-short GBPUSD- a ratio stands during -1.52 (39.6% of traders are long) – diseased bullishreading
  • Retail has remained net-short given Dec 28; cost has changed 1.1% aloft given then
  • Long positions are 3.1% reduce than yesterday and 0.2% aloft from final week
  • Short positions are 10.1% reduce than yesterday and 16.2% reduce from final week
  • We typically take a contrarian perspective to throng sentiment, and a fact traders are net-short suggests GBPUSD prices might continue to rise. Yet traders are reduction net-short than yesterday and compared with final week. Recent changes in view advise that a stream GBPUSD cost trend might shortly retreat reduce notwithstanding a fact traders sojourn net-short.

See how shifts in GBP/USD sell positioning are impacting trend- Click here to learn some-more about sentiment!

Relevant Data Releases

GBP/USD Economic Calendar

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Other Setups in Play

– Written by Michael Boutros, Currency Strategist with DailyFX

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