GBP/USD Technical Outlook: Sterling, Down though Not Out

The British Pound is down scarcely 1.4% from a monthly high as a shakeup in a UK council fueled ongoing concerns per a Brexit conditions. Despite a decline, cost continues to trade only above a long-term, vicious support connection and IF prices are streamer higher, Cable needs to reason these lows. Here are a updated targets and cancellation levels that matter for GBP/USD streamer into a tighten of a week. Review this week’s Strategy Webinar for an in-depth relapse of this setup and more.

GBP/USD Daily Price Chart

GBP/USD Daily Price Chart

Technical Outlook: In my many new Weekly Technical Perspective on a British Pound, we highlighted how GBP/USD had unsuccessful churned attempts to mangle next a pivotal support connection around ~1.3164. The miscarry off pitchfork support unsuccessful during a top together (red) though a pullback continues to trade only above this pivotal support zone.

IF Sterling has incited a corner, we’ll wish to see a weekly tighten above this threshold. Daily insurgency stays solid during 1.3311a tighten above this shifts a concentration towards a median-line and some-more poignant insurgency during 1.3495. A mangle reduce risks estimable waste for a Pound with such a unfolding targeting a reduce together / Oct lows during 1.3027.

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GBP/USD 120min Price Chart

GBP/USD 120min Price Chart

Notes: A closer demeanour during cost movement sees Cable still trade within a weekly opening range. It’s a conflict of a monthly opens with a evident operation in concentration between 1.3180-1.3290. On a slip lower, 1.3164 and 1.3127 are levels of seductiveness for intraday cost depletion though watch a close. A topside crack change a concentration towards successive insurgency objectives during 1.3362 and 1.3450.

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Bottom line: Sterling is trade only above BIG weekly support and IF prices are streamer higher, waste should be singular by 1.3127. From a trade standpoint, I’m looking for depletion / long-entries on a dump towards a highlighted support targets with a crack above 1.3290 indispensable to get things going.

For a finish relapse of Michael’s trade strategy, examination his Foundations of Technical Analysis series on Building a Trading Strategy

GBP/USD Trader Sentiment

GBP/USD Trader Sentiment

  • A outline of IG Client Sentiment shows traders are net-long GBP/USD- a ratio stands during +1.93 (65.9% of traders are long) – bearishreading
  • Traders have remained net-long given April 20th; cost has changed 6.2% reduce given then
  • Long positions are 0.8% aloft than yesterday but 9.4% reduce from final week
  • Short positions are 2.9% reduce than yesterday and 10.6% aloft from final week
  • We typically take a contrarian perspective to throng sentiment, and a fact traders are net-long suggests GBP/USD prices might continue to fall. Traders are some-more net-long than yesterday but reduction net-long from final week and the multiple of stream positioning and new changes gives us a serve churned GBP/USD trade bias from a view standpoint.

See how shifts in GBP/USD retail positioning are impacting trend- Learn some-more about sentiment!

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– Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex or hit him during mboutros@dailyfx.com

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