GBP/USD eyes 1.2608 as the next downside level

May 22,2019 16:26   Source:Forex Crunch

GBP/USD made a round trip to the upside on Tuesday after UK PM Theresa May presented a new plan only to see it rejected by her colleagues and her political opponents alike. What’s next for GBP/USD?

The Technical Confluences Indicator shows that GBP/USD faces resistance at 1.2721 which is the convergence of the Simple Moving average 100-15m, the SMA 5-4h, the SMA 10-15m, the Fibonacci 23.6% one-day, the Bollinger Band 1h-Middle, and the BB 15min-Upper.

Looking up, the currency pair faces resistance at 1.2792 where we see the Fibonacci 23.6% one-week and the Pivot Point one-day Resistance 1 converge.

Support awaits at 1.2687 where we note the confluence of the BB 1d-Lower, the previous daily low, the BB 1h-Lower, and the BB 4h-Lower.

The next support is already much lower, at 1.2608 where the PP one-day S2 and the PP 1w-S1 meet.

This is how it looks on the tool:

GBP USD technical confluence May 22 2019

Confluence Detector

The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. This means that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.

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