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Technical Outlook: GBPUSD – Friday’s Long Red Candle Weighs And Risks Fresh Downside After Correction

Cable is consolidating above 1.2800 handle on Monday, following Friday’s strong fall. Strong bearish acceleration was triggered after thick weekly cloud repeatedly capped bull-leg from 1.2365. Dip found footstep at 1.2775 and managed to close above 1.2786 pivot (Fibo 38.2% of 1.2356/1.3047 upleg), sidelining immediate downside risk.

However, Friday’s long bearish candle continues to weigh, with daily studies losing traction and seeing risk of further easing.

Current action could be seen as positioning for fresh easing with extended upticks seen on oversold slow stochastic on daily chart, expected to stay capped under converged 20/10 SMA’s (1.2926/35 respectively). Bearish continuation requires close below Fibo 1.2786 support to open way for extension towards 55SMA (1.2694) and daily cloud top at 1.2656.

Conversely, sustained break above 20/10SMA’s would signal an end of corrective phase from 1.3047 (18 May peak).

Res: 1.2866, 1.2895, 1.2911, 1.2935
Sup: 1.2786, 1.2775, 1.2694, 1.2656

Windsor Brokers Ltd
Windsor Brokers Ltdhttp://www.windsorbrokers.com/
The information contained in this document was obtained from sources believed to be reliable, but its accuracy or completeness cannot be guaranteed. Any opinions expressed herein are in good faith, but are subject to change without notice. No liability accepted whatsoever for any direct or consequential loss arising from the use of this document.

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