GBP/USD Bearish Sub-1.4588 Ahead of Upcoming Event Risk
- GBP/USD weekly opening range in focus
- Immediate short bias at risk heading into U.K. & U.S. event risk
- Updated targets & invalidation levels
Chart Created Using FXCM Marketscope 2.0
Technical Outlook: Sterling has set a simple weekly opening range just below the March high-day close at 1.4472 and we’ll be looking for a break to validate our near-term bias. Keep in mind we have UK industrial / manufacturing production numbers tomorrow, followed by the BoE & U.S. retail sales later in the week – so the docket favors volatility in this pair.
From a trading standpoint, the move off parallel resistance noted last week remains in focus and I would be looking for support heading into the lower median-line parallel (blue) / 1.4296-14305. A topside breach of the opening range would shift the near-term focus higher targeting 1.4528 & the monthly open / February high-day close at 1.4580/88. Keep in mind that ultimately we would be looking to sell a rebound with our broader focus weighted to the short-side sub 1.4664/83. A break lower targets subsequent support objectives at the 61.8% retracement at 1.4196.Continue tracking this setup and more throughout the week-
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- A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders remain net long the pound - the ratio stands at +1.18 (54% of traders are long)- weak reading
- Open interest is 1.4% higher than yesterday and 1.7% above its monthly average.
- Ratio has been positive since 5/5 – (high in price was on 5/3)- Keeps focus lower, corrective action (rallies) to be sold
Why and how do we use the SSI in trading? View our video and download the free indicator here
Relevant Data Releases This Week
Other Setups in Play:
- AUD/CAD Into Key Support- Monthly Opening Range In Focus
- EUR/USD Approaching Initial Support- Levels to Watch for NFPs
- GBP/USDReversal Approaching Initial Support Targets
- NZD/USD Fails at 2016 High Ahead of Labor Report- Bearish Sub 7025
- USD/CAD Outside Day Reversal Off Key Support- Long Scalps in Play
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---Written by Michael Boutros, Currency Strategist with DailyFX
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.