Talking Points
- GBP/USD Breaks Lower on BOE Governor Carneys Statements
- GBP/USD Retracements May Begin Over 1.3311
- SSI for the GBP/USD Reaches an Extreme at +2.04
The British Pound continues to slide this morning, as Bank of England Governor Carney has suggested that further easing may be necessary over the summer months. This news immediately sent the GBP/USD sliding through the key 1.3400 support value. Prices are now bouncing from the daily low at 1.3242, but this leaves traders to consider whether the pair will resume its ongoing downtrend.
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GBP/USD, 5 Minute Chart & Breakout
(Created by Walker England)
Displayed in the 5-minute chart below, The GBP/USD can be seen retracing off of the daily lows. This short-term upswing has been noted by the GSI indicator, by highlighting a series of higher highs and higher lows printed in the preceding 5 minute candles. After reviewing 52,243,446 pricing points, GSI has indicated that price action has advanced a minimum of 13 pips in 57% of the 97 matching historical events. Traders looking for a full retracement of this morning’s bearish breakout should watch for prices to test the first historical bullish distribution found at 1.3311. With a rejection in price action at this point, traders may begin looking for fresh signals for downward momentum.
Want to learn more about GSI? Get started learning about the Index HERE.
GBP/USD 5Minute GSI Chart
(Created by Walker England)
Sentiment for the GBP/USD has just reached and extreme with SSI (speculative sentiment index) reading at +2.04. With 67% of positioning long, this may suggest that the GBP/USD may continue to trade lower. In the event of a further price decline, traders should look for SSI to extend to a greater positive extreme. Alternatively, in the event of a bullish price reversal, traders should watch for SSI to level out from extremes and move towards a more neutral value.
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