Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View More
GBP/USD Rebound Looks to UK Jobs for Fuel- 1.31 Barrier in View

GBP/USD Rebound Looks to UK Jobs for Fuel- 1.31 Barrier in View

Michael Boutros,

Talking Points

  • GBP/USD turns from Fibonacci support ahead of UK jobs data
  • Updated targets & invalidation levels

GBPUSD 120min

Chart Created Using TradingView

Technical Outlook: Sterling is trading within the confines of a descending pitchfork formation with the exchange rate rebounding off the 88.6% retracement of the post-Brexit advance last night. The focus is on initial resistance at 1.3056 with a breach above the upper parallel / 1.3100 needed to validate a near-term reversal in the pair.

Interim support rests with the weekly open / low-day close at 1.2921/26 with a break below 1.2870 needed to shift the focus back to the short-side. A breakout of this formation targets subsequent topside objectives at 1.3173 & the 61.8% retracement / monthly open at 1.3238/46.

From a trading standpoint, I would be looking to fade weakness while above 1.2950 near-term - we'll have to asses how the pair reacts on a move into the 1.31-handle. For the complete setup and to continue tracking this trade& more throughout the week- Subscribe to SB Trade Deskand take advantage of the DailyFX New Subscriber Discount.

Avoid the pitfalls of near-term trading strategies by steering clear of classic mistakes. Review these principles in the "Traits of SuccessfulTraders” series.

  • A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders are net long GBPUSD- the ratio stands at +2.76(73% of traders are long)-bearishreading
  • Yesterday the ratio was +2.34. Long positions are 4.1% higher than yesterday and 36.4% above levels seen last week.
  • Open interest is 0.5% lower than yesterday but 10.1% above its monthly average.
  • While this would normally be interpreted as a bearish reading, it’s important to note that SSI is approaching post-Brexit extremes and is likely to see limited downside near-term. That said, a pullback off SSI extremes alongside a breach above 1.31 would suggest a larger-scale recovery is underway.

Help fine-tune you entries, click here to learn more about the DailyFX Grid Sight Index (GSI)

Relevant Data Releases This Week

Other Setups in Play:

Looking for more trade ideas? Review DailyFX’s Top Trading Opportunity of 2016

---Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michaelon Twitter @MBForex contact him at mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael for Live Scalping Webinars on Mondays on DailyFX and Tuesday, Wednesday & Thursday’s on SB Trade Desk at 12:30 GMT (8:30ET)

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES