Daily Pivots: (S1) 1.2839; (P) 1.2889; (R1) 1.2922; More

GBP/USD’s firm break of 1.2844 support now suggests that corrective rebound from 1.2661 has completed at 1.3042. Intraday bias is turned back to the downside for retesting 1.2661 first. Decisive break there will resume larger down trend from 1.4376. On the upside, above 1.2932 minor resistance will extend the correction from 1.2661 with another rise, possibly through 1.3042 resistance. But in that case, upside should be limited by 1.3316 fibonacci level to finish the rebound and bring near term reversal.

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In the bigger picture, whole medium term rebound from 1.1946 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4099). The structure and momentum of the fall from 1.4376 argues that it’s resuming long term down trend. And this will be the preferred case as long as 38.2% retracement of 1.4376 to 1.2661 at 1.3316 holds. However, firm break of 1.3316 would bring stronger rebound to 61.8% retracement at 1.3721. And, the eventual depth of the fall from 1.4376, and the chance of hitting 1.1946 low, will depend on the strength of the interim corrective rebound from 1.2661.

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