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GBP/USD: Fret Not, a Resolution is at Hand- Critical Support 1.23

GBP/USD: Fret Not, a Resolution is at Hand- Critical Support 1.23

Michael Boutros,

Talking Points

  • GBP/USD carves weekly opening range just above support
  • Updated targets & invalidation levels
  • Looking for more trade ideas? Review DailyFX’s 2017 Trading Guides. Join Michael for Live Weekly Trading Webinars on Mondays at 13:30GMT (8:30ET)


GBP/USD Daily Chart

Technical Outlook:Cable is testing a near-term support confluence at 1.2410/33- this region is defined by the 2016 low-day close & the 100-day moving average and is backed closely by the 61.8% line of the ascending pitchfork formation. A break below this mark shifts the focus towards support targets at 1.2363 & 1.2303/17 – bullish invalidation & an area of interest for exhaustion / long-entries. Resistance stands at the March highs with a breach above 1.2675-1.27 needed to fuel the next Big leg higher for sterling.

GBPUSD 240min

GBP/USD 240min Chart

Notes:A closer look at price action highlights near-term support at the weekly opening-range lows here. Bottom line from a trading standpoint, I’m looking for a resolution to this correction off the March rally with 2-equal legs lower converging on the 61.8% retracement at 1.2301/32- We’ll favor fading weakness while above this threshold with a breach above the weekly range highs / 1.2570 shifting the near-term focus back to the long-side.

A quarter of the daily average true range (ATR) yields profit targets of 24-28 pips per scalp. Added caution is warranted heading U.S. ISM data tomorrow and the latter part of the week with commentary from BoE Governor Mark Carney & Non-Farm Payrolls on Friday likely to fuel increased volatility in their respective crosses.

  • A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders are net-short GBPUSD- the ratio stands at -1.16 (46.2% of traders are long)- weak bullish reading
  • Long positions are 8.6% lower than yesterday and 8.0% lower from last week
  • Short positions are 5.3% higher than yesterday and 12.2% higher from last week
  • Although we cannot rule out another run at the lows, the recent build in short-positioning alongside waning long interest does further highlight a bullish SSI bias.


Relevant Data Releases

Other Setups in Play:

- Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex contact him at or Click Here to be added to his email distribution list.

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