FOREX Chart Of The Day: GBPUSD At Highs
Have you traded #GBPUSD?
The price is currently rejecting channel highs.
Could we see the market continue to fall?
Watch the video to learn more…
Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, Head Currency Analyst.
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In this video, we’re going to take a look at GBP/USD. We’ve entered a position short on this. I just wanted to go through my position and what we’re potentially looking at for the future, and what we can potentially see happening with this currency pair.
The GB Pound was on the cars for some downside. Just because we were looking from the point of view, recently, from the area, here, around 1.33 level. We identified this zone as an area of resistance. We were talking about this in our GBP/AUD analysis. We suggested that if the GB Pound was to find some resistance here, then we could look for GB Pound weakness across other pairs. Obviously, we have this channel nicely put in here where we have these previous structure highs. The price has now re-entered that rejected, and gave us that daily bearish close. So that gives us the opportunity to look for that short. The price has only recently just pushed through this today. Now, we’re looking for that further downside.
Now, we could be looking for the prices to come back into these channel lows. Obviously, when we’re looking for these positions, we wanted to get a good area of resistance, as one. If we look across, we can see that 1.3 is a decent area. We have these previous lows, over here. We have these previous structure highs at this point as well. So, we’re looking for the market to drop back down into that 1.3 level.
Now, if I go into the four-hour time frame, at the moment, the four-hour is doing quite nicely in terms of we’ve broken through some recent areas. Let me get rid of these, at the moment, because we’re looking for a reversal opportunity.
So essentially, the price is trending to the upside, and what we see here is the fact that the market then makes a move to the downside, retests that previous structure high, rallies, and breaks through. So, 1.32 is actually a really nice level on the market, and we may actually see price retest once again. I’m actually expecting maybe a slight downside into these lows here, a break-up, retests that 1.32 continuation, and some further moves back down into that 1.3 level.
So very, very early days in this trade at the moment. But, I like the fact that the market came into this area of resistance. We’ve rejected, and we’re starting to break down a little bit.
Looking at the daily time frame, we’ve just recently retested the RSI highs and the resistance highs on the RSI, and we’re rejecting that. So, it’s looking good for some potential further downside here for the GB Pound. Looking at this market, obviously, as we’ve already said to drop a little bit lower – work within that channel. It’s almost like we have this impulse move, here. This channel is our correction of that impulse move. We could get another move to the downside from there with a similar move and maybe a potential breakout. That’s what we’re looking at, here, with GB Pound – targeting the lows first. If it breaks out, we can look for further downside If that US Dollar strength does come in, Like we’ve been thinking about for the past month or so.
Hopefully, we do see that come through, see that GB Pound drops a little bit lower. The Brexit risk might also put a bit of pressure on the price of the GB Pound. So, we could add that into the mix as well.
But, we’re technically rejecting this level, looking good for further downside.
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