- GBP/USD at risk ahead of EU/UK Brexit talks – price constructive while above monthly open
The British Pound continues to trade within the weekly opening-range heading into the EU/UK Brexit negotiations. Here are the updated targets and invalidation levels that matter on the GBP/USD charts this week.
GBP/USD DAILY PRICE CHART
Technical Outlook: GBP/USD has been trading within the confines of this descending pitchfork formation extending off the yearly highs – we highlighted the threat of a larger pullback in the British Pound last weekas price was carving out an outside-day reversal off the 75% slope line. Note that daily RSI failed at the 60-threshold and further highlights the near-term risk for steeper losses here.
That said, the broader outlook remains weighted to the topside while above the August trendline with initial daily support eyed at the 100-day moving average (currently ~1.31) backed by the October open at 1.3031- we’re on the lookout for downside exhaustion off one of these levels. A topside breach of the monthly range highs looks to challenge more significant resistance at the confluence of the December low, the September highs and the 38.2% retracement at 1.3302/17 and the upper parallel around ~1.3360s.
GBP/USD 240MIN PRICE CHART
Notes: A closer look at near-term price action shows Sterling holding a within a clean weekly opening-rangejust below the 100% extension of the monthly advance at 1.3239. A break below 1.3090 targets confluence support at 1.3031/50- an area of interest for possible long-entries IF reached. Weakness beyond this region would invalidate the monthly advance with such a scenario risking a decline back towards 1.2877-1.2905.
Bottom line: Sterling has carved out a clear weekly opening-range and we’re looking for the break for offer further guidance. From a trading standpoint, I’ll favor fading weakness while above monthly open support with a breach above 1.3239 needed to fuel the next leg higher in price. Keep in mind there is considerable event risk on the horizon with EU-UK Brexit summit likely to dominate the headlines over the next 48 hours – tread lightly.
GBP/USD TRADER SENTIMENT
No comments:
Post a Comment