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
EUR/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/cKOUmtj7Dj
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/Yl9vM7kO6a https://t.co/TnL91f7sl7
  • Human error in the forex market is common and often leads to familiar trading mistakes. These trading mistakes crop up particularly with novice traders on a regular basis. Learn about the top ten trading mistakes and how you can avoid them here: https://t.co/i8E2AXtzF3 https://t.co/cDcjl3Ue09
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here: https://t.co/yOEvLjKnct https://t.co/KWOX5wSipe
  • What is your forex trading style? Take the quiz and find out: https://t.co/YY3ePTpzSI https://t.co/cwSWCpKtaj
  • Japanese candlesticks are a popular charting technique used by many traders, and the shooting star candle is no exception. Learn about the shooting star candlestick and how to trade it here: https://t.co/mfwJ0sZLTs https://t.co/zu5hMovbz6
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZFxlk https://t.co/QMKyTBOKNG
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/aRkGoNvj6D
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here: https://t.co/t9Flsqcxo9 https://t.co/ltVTNO2sjT
  • GBP/USD clears the May low (1.3801) as the Federal Reserve forecasts two rate hikes for 2023. Get your $GBP market update from @DavidJSong here:https://t.co/WdTG2niAKz https://t.co/2j02VyH0wm
GBP/USD Technical Analysis: Bullish but Nearing Resistance Barrier

GBP/USD Technical Analysis: Bullish but Nearing Resistance Barrier

James Stanley, Senior Strategist

To receive James Stanley’s Analysis directly via email, please sign up here.

Talking Points:

  • GBP/USD Technical Strategy: Near-term price action continues moving higher in a bullish manner.
  • While price action remains below the longer-term support value of 1.3500, the pair could pose continued bullish price action as additional rate-cut bets for the U.K. unwind as inflationary pressure has begun to show.
  • SSI - If you’re looking for trading ideas, check out our Trading Guides. And if you want something more short-term in nature, check out our SSI indicator.

In our last article, we looked at the potential for the British Pound to pose an extended top-side run after the Bank of England’s post-Brexit maneuvering drove the Sterling lower; exposing the economy to inflationary pressure as import prices continue to tick higher. And while this may not necessarily amount to a rate hike for a bank that just unloaded an artillery of stimulus last month, it could soften additional rate-cut bets as higher levels of inflation force the BoE’s hand away from future dovish moves.

Since that article, GBP/USD broke out of the top-side of the symmetrical wedge formation that had built-in post-Brexit, and prices have continued to trounce higher with higher-highs and higher-lows printing throughout; furthering the bullish case for the Cable.

There is but one complication with bullish strategies on the pair at the moment, and that’s the outsized thicket of resistance sitting above current price action. At 1.3480 we have the July swing-high in the pair; at 1.3500 we have the ‘Financial Collapse low’ that set swing support on the pair for more than 7-years before giving way to Brexit-driven price action earlier this summer. And just a bit above that at 1.3532 we have the post-Brexit swing-high; and this was the peak level in the pair just ahead of Mark Carney’s impromptu press conference just days after the Brexit referendum, in which he assured markets that accommodation would be coming from the Bank of England, preemptively.

Traders would likely want to move forward with bullish approaches in one of two ways: A) wait for a deeper support inflection in order to get long or B) let the batch of top-side resistance give way to confirm the pair’s bullish potential before triggering long, at which point traders can look to buy ‘higher-low’ support. For the inside approach, traders would likely want to target the zone around 1.3250, as this has a key Fibonacci retracement level as well as being a psychological level and a prior form of resistance (outlined in purple on the below chart). For traders looking to wait for more information, let the pair break above the 1.3532 level before looking to catch that ‘higher-low,’ which given current technical structure can be attractive if showing up in the zone from 1.3480-1.3500.

GBP/USD Technical Analysis: Bullish but Nearing Resistance Barrier

Chart prepared by James Stanley

--- Written by James Stanley, Analyst for DailyFX.com

To receive James Stanley’s analysis directly via email, please SIGN UP HERE

Contact and follow James on Twitter: @JStanleyFX

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

DISCLOSURES