GBP/USD faces a wall of resistance on any recovery attempt

Jun 28,2019 20:54   Source:Forex Crunch

GBP/USD is trading in the mid-1.2600s after the US dollar reasserted itself and as fears of a hard Brexit weigh on the pound. Where next?

The Technical Confluences Indicator shows that GBP/USD faces a wall of resistance at 1.2780 which is a dense cluster including the four-hour low, the Simple Moving Average 200-1h, the SMA 10-1h, the Bollinger Band 15min-Middle, the SMA 50-4h, the Fibonacci 23.6% one-day, the Bollinger Band 15min-Upper, the SMA 5-4h, and others.

Further above, cable faces another concentration of technical hurdles at 1.2707 where we note a convergence of lines including the Fibonacci 61.8% one-day, the Fibonacci 23.6% one-month, the SMA 200-1h, and the SMA 5-1d.

Support is weaker and significantly lower than current prices. 1.2588 is the confluence of the Pivot Point one-week S2 and the PP 1d-S3.

The next cushion is around 1.2561 which is where the previous monthly low and the Bollinger Band one-day-Lower.

This is how it looks on the tool:

GBP USD confluence detector June 27 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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