Bank of England cut rates and caught markets off guard by increasing the QE program. The result was a drop in GBP across the board. Cable retreated from the pre-BOE high of 1.3345 to a session low of 1.3111. At the time of writing, the pair traded around 1.3135. Daily chart – Bearish Symmetrical triangle breakout, but bullish invalidation only below 1.3056 ...
Cable’s daily closing above 1.3315 (23.6% Fibo retracement of 1.5019-1.2789) on Tuesday adds credence to the view that a short-term bottom has been made at 1.2789 and the technical correction is likely to continue, but reckon the resistance at 1.3363 (50% Fibo expansion level of Nov 2007 high – Jan 2009 low – July 2015 high) would remain intact ahead of tomorrow’s...
Today’s bullish move to a high of 1.3295 is a welcome development, however, bullish momentum is seen gathering pace only above 1.3315 (23.6% of 1.5019-1.2789), in which case the spot could test major hurdle at 1.3363 (50% of Fibo extension). On the other hand, fresh sell-off is seen happening only below 1.3054 levels. Unless, we don’t see a breach of...
Third attempt today to place some winning trades. Thankfully this time I seem to have taken the peak and should be good from here. Some basic technical and my trade lines drawn on. Lost $250 ish today. Still working with 50k lot size. Aiming for a large level profit once we touch down on green again :)
We have a head and shoulder breakout last month coupled with a bearish break from falling wedge formation and a monthly closing below 1.3363 (50% Fibonacci extension of 2007 high – 2009 low – 2014 high). Action this month has been anything but encouraging for the bulls. We failed to hold above head and shoulder neckline as well as 1.3363, in a way marking a...
UK 10-year gilt yield slipped to record lows, dragging GBP lower along with itself. The message is clear - markets are pricing-in a rate cut by Bank of England (BOE) next week. If Reuters poll is to be believed, the BOE is likely to cut rates but hold off QE for now. That makes sense, since we are yet to receive labor market data, wage growth data for post...
15-min chart pattern - sideways channel - 1.3165-1.3056 At the moment, there is little hint of a bullish/bearish move on charts. Hence, it is advisable to play the breakout. Above 1.3165 we could go to 1.3315 (23.6% of 1.5019-1.2789). On the other hand, below 1.3056, the spot is likely to test 1.29 levels. UK preliminary estimate of Q2 GDP is likely to show...
Cable’s resilience and determination to hold above 1.31 handle despite batch of bearish news in Asia suggests an attempt is likely to be made at 1.3206 levels today. News hit the wires in early Asia that BOE’s Weale, a well known hawk, is calling for immediate stimulus. That pushed Cable lower from around 1.3160 to 1.3082 before bird quickly recovered above 1.31...
Pound was offered across the board in Europe after the preliminary PMI readings for July highlighted a sharp deterioration of the activity. It is a known fact that PMIs have been on a declining trend since 2013, but the drop in July is obviously being blamed on Brexit. This forced markets to sell Sterling in anticipation of BOE rate cut/QE in August. ...
Despite repeated failure to take out/hold above 1.3315 (23.6% of 1.5019-1.2789) , the bird has been able to avoid a drop below 1.3061 Tuesday's low and has managed to form a small rising bottom formation this week. Consequently, the odds of the pair breaking above stiff resistance at 1.3315 today are high. In such a case, inverse head and shoulder neckline...
Pair’s recovery from yesterday’s low of 1.3064 and a subsequent move back above a minor head and shoulder neckline suggests the spot is likely to extend gains towards a larger inverse head and shoulder neckline level seen around 1.3465. The bullish view is at a risk of a break below yesterday’s low of 1.3064 in which case the spot could take out 1.30 and move...
Pattern - Inverse head and shoulder on 4-hour chart Pair’s retreat from Friday’s high of 1.3480 followed by a day end closing at 1.3173 suggests the corrective move from the low of 1.2789 has ended and choppy trading is likely to be seen today. A failure to sustain above 5-DMA of 1.3230 would open doors for a drop to 10-DMA of 1.3093. On the higher...
Pair’s failure to stay above the post BOE high of 1.3472 in Asia followed by a retreat to 1.34 handle despite inverse head and shoulder breakout on 4 hourly chart on Thursday suggests the correction from post Brexit sell-off may have temporarily run out of steam and amid oversold hourly RSI could yield a re-test of inverse head and shoulder neckline level of 1.33....
Now we have almost confirmed an inverse head and shoulder breakout on the 4-hr chart, courtesy of Bank of England's decision to keep interest rates unchanged. This goes well with the head and shoulder breakout seen on the Gold/GBP 4-hour chart . Both the chart in a way add credence to each other and confirm the GBP is likely to move higher in the...
Resistance – 1.3315, 1.3419, 1.3533 Support – 1.3206, 1.3119, 1.3077 Pair extended the corrective move in Asia to a high of 1.3337 as realization seems to have seeped into the markets that the Bank of England (BOE) may prefer to wait for more evidence of the Brexit led slowdown and in the economy and thus not cut rates this week. Cable’s nearly 500 pips...
Cable’s bullish break from the 4-hourly falling channel followed by a convincing move to near 1.41 handle suggests a temporary bottom is in place at 1.2789 and could yield sideways to positive action, but reckon the hurdle at 1.3119 (previous cyclical low) could stay intact. On the lower side, only a move back below 1.30 from here would suggest a major...
As expected in the morning update, pair suffered losses after having failed to sustain above 5-DMA. However, the losses were cut short at 1.2850 after news Andrea Leadsom quit Tory leadership race. Theresa May now looks set to be crowned Prime Minister. Pair’s sharp reversal from 1.2850 has kept the bullish price-RSI divergence on the 4-hr chart intact and...
Resistance – 1.2949, 1.30, 1.3119 Support – 1.2927, 1.2880, 1.2789 Pair’s repeated failure to sustain above 1.30 last week if followed by a failure to sustain above 1.2949 (5-DMA) today would open doors for a drop to 1.2880. A violation there would expose the latest cyclical low of 1.2789. On the higher side, 1.30 needs to be taken out on the day end...