GBPUSD Weekly Technical Outlook
The 1.19740 area is a major horizontal support on the GBPUSD monthly time frame. The area has held as support since March 2017. In July 2019, market operation revisited the area after a 78.6 Fib retracement, in January 2018, of the drop from the high of June 2016 to the low of October 2016. A bullish pullback from the area was initiated in September 2019. This followed through to the 50 Fib area, around 1.35485, in December 2019 before a southward bend was effected. In February 2020, a bearish continuation candlestick was printed by the market. But as market operation entered the reaction area around 1.27460, bulls resisted further southward move, resulting in a bearish candlestick print with a lower shadow in February. Recent technical pattern on the monthly time frame, e.g. respect of Fib zones, indicates that we may have further southward move, perhaps to target the next horizontal reaction area around 1.24220/1.23770 (light green), which is, of course, a long way to go.
On the weekly time frame, presently a bearish pressure has emerged after a significant bullish move. A double inside bar formation followed the candlestick print of four weeks ago. But the bearish candlestick printed last week failed to provide a follow-through directional momentum as it did not significantly break below the control-candlestick printed four weeks ago. In fact, last week’s candlestick ended with a longer bottom tail than its upper shadow, indicating that bulls are still influential in the market. Although the technical outlook still favours bears, It will take a significant break below the 1.27460 area before we can expect a reliable bearish drive.
Recent price action on the daily time frame shows a decline in bullish drive after an evening star formation around the 1.33200 area on December 17, 2019. A resistance channel (blue) has been created from recent highs and we can expect price action to sway negatively should the channel hold. But we can expect a retracement into the channel in the early part of this week before any southward continuation, particularly after price action printed a candlestick with shadow on both ends on Friday, which indicates that bulls are still influential in the market.
On the H4 time frame, a bullish pullback was begun at the last 4-hr session on Friday. We can expect a bearish turnaround at the next area of value, which is much likely to be within the 1.28900/1.29700 zone (bound by magenta horizontal lines). I am bearish GBPUSD.
I may be wrong. Trade safe and prosper.
KP
The 1.19740 area is a major horizontal support on the GBPUSD monthly time frame. The area has held as support since March 2017. In July 2019, market operation revisited the area after a 78.6 Fib retracement, in January 2018, of the drop from the high of June 2016 to the low of October 2016. A bullish pullback from the area was initiated in September 2019. This followed through to the 50 Fib area, around 1.35485, in December 2019 before a southward bend was effected. In February 2020, a bearish continuation candlestick was printed by the market. But as market operation entered the reaction area around 1.27460, bulls resisted further southward move, resulting in a bearish candlestick print with a lower shadow in February. Recent technical pattern on the monthly time frame, e.g. respect of Fib zones, indicates that we may have further southward move, perhaps to target the next horizontal reaction area around 1.24220/1.23770 (light green), which is, of course, a long way to go.
On the weekly time frame, presently a bearish pressure has emerged after a significant bullish move. A double inside bar formation followed the candlestick print of four weeks ago. But the bearish candlestick printed last week failed to provide a follow-through directional momentum as it did not significantly break below the control-candlestick printed four weeks ago. In fact, last week’s candlestick ended with a longer bottom tail than its upper shadow, indicating that bulls are still influential in the market. Although the technical outlook still favours bears, It will take a significant break below the 1.27460 area before we can expect a reliable bearish drive.
Recent price action on the daily time frame shows a decline in bullish drive after an evening star formation around the 1.33200 area on December 17, 2019. A resistance channel (blue) has been created from recent highs and we can expect price action to sway negatively should the channel hold. But we can expect a retracement into the channel in the early part of this week before any southward continuation, particularly after price action printed a candlestick with shadow on both ends on Friday, which indicates that bulls are still influential in the market.
On the H4 time frame, a bullish pullback was begun at the last 4-hr session on Friday. We can expect a bearish turnaround at the next area of value, which is much likely to be within the 1.28900/1.29700 zone (bound by magenta horizontal lines). I am bearish GBPUSD.
I may be wrong. Trade safe and prosper.
KP
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