Looking at this GBP/USD 1-hour chart:
1. Supertrend Indicator Analysis:
The Supertrend indicator (10,3) is green, showing that the price is in an uptrend. This suggests that buyers are currently in control.
The Supertrend works as dynamic support and resistance. In this case, the green line can be seen as a support level. As long as the price stays above this line, the bullish momentum is intact.
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2. Demand Zone and Support Levels:
Demand Zone: The highlighted area below Support 2 indicates a strong buying zone. Price has previously rebounded sharply from this area, meaning buyers are likely to step in if the price revisits this zone.
Support 1: This is an intermediate support level. If the price pulls back slightly, it may find support here before continuing higher. It's a good zone to watch for bullish price action patterns like pin bars or engulfing candles.
Support 2: This level is stronger than Support 1, as it coincides with the demand zone. A deeper retracement to this level would still keep the overall bullish bias intact.
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3. Rising Channel:
The ascending channel indicates that the price is making higher highs and higher lows, a characteristic of an uptrend.
Key Levels to Watch:
A breakout above the channel's upper boundary could signal an acceleration in the uptrend, opening the door for further bullish targets.
A break below the channel's lower boundary could mean the price will retrace further, potentially toward Support 1 or the demand zone.
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4. Key Resistance Zone:
The price is approaching the 1.25696 resistance level, which aligns with the upper boundary of the ascending channel.
If the price struggles to break above this level, it could signal a short-term pullback. However, a strong breakout with high volume could suggest further upside potential.
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5. Trade Ideas:
Bullish Scenario:
Pullback Entry: If the price pulls back to Support 1 or the lower boundary of the channel, look for bullish candlestick patterns (e.g., hammer or bullish engulfing) for a long entry.
Breakout Entry: If the price breaks and closes above the 1.25696 resistance, enter a buy position targeting the next significant resistance (likely 1.2600-1.2650 range).
Bearish Scenario (Short-Term Correction):
If the price breaks below the lower boundary of the channel, expect a pullback toward Support 2 or the demand zone. In this case, short-term selling opportunities might arise.
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6. Risk Management:
Use a stop-loss below Support 1 or the demand zone (depending on your entry).
Target a reward-to-risk ratio of at least 2:1.
Be cautious of fundamental events (e.g., U.S. or U.K. economic data) that could cause volatility in GBP/USD.
Trade closed: target reached
Target hit 🎯
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.