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I’m going to begin the day today on the Greater British Pound versus the US Dollar [GBPUSD]. Starting here on the Daily Chart, we could see that over the past several days we have found resistance into this green-shaded area. The green-shaded area at the top of the chart goes between the 1.6125-level and 1.6160-level. So, about 30 to 35 pips highlighted in green at the top of the chart.
Follow that green-shaded area back in time. We could see on the left-hand side over the chart; we could see some historical resistance into this area. This is a key level of resistance. As we could see, a couple of weeks ago, where FOMC caused a large spike, as this currency went higher that’s where the market came to a screeching stop and then turned around and went back down into the 1.5900s, but now we’re challenging that key resistance level one more time.
If it can break through the 1.6160-level or so – the peak high that we see here – we’ll likely look for a continuation of the up trend as we push back into the mid- to upper-1.6200s. If it holds here and creates somewhat of a double top here, we likely look for potential reversal, a challenge back into the 1.6000-level. Beyond that, we could even challenge all the way back down into the 1.5800s, down towards the bullish trend line.
Over the past several months, we’ve created somewhat of a bullish trend channel. As we could see, the bottom trend line connecting with the lows within the up trend. The top trend line connecting with the highs within the up trend. We are current towards the top side of that trend channel. We’re towards the top trend line within that trend channel. As long as it holds underneath it, there is potential for some reversal to go back down towards the bottom of the trend channel and the bottom trend line.
That could be here, into the blue-shaded area, or possibly all the way back down here towards the yellow zone into the 1.5800s. But either way you look at this currency pair, we are towards the top side of the trend, which discourages you from looking for buys, because as the market reaches into a resistance, as it reaches into a price ceiling, where it consistently, over time, has found resistance, there’s a greater expectation that it finds resistance and turns around and goes back down as long as it stays underneath it. Only if it breaks above that and breaks through what is somewhat like a brick wall in the market – only if it breaks through that green-shaded area would you expect it to continue to pressure higher.
So, your expectations today are resistance underneath 1.6150 to 1.6160. That’s the top of the cialis without prescription green-shaded area, and potential indicators that tell you it’s going to reverse and go back down. Until or unless it breaks above 1.6160 and then you likely look for it to go higher towards the purple-shaded area, which is up into the mid-1.6200s, and our last historical resistance highs that we see over here on the left-hand side of the chart.
Take that information down here towards the 4-Hour Chart and we’ll get that scooted back over to current time on this chart. And here we go. There’s the blue trend lines of course, representing the larger trend channel. We can see that over the past several days, the market has been challenging here into the bank flow levels. Over the past few days, we could see the market holding into those or underneath those bank flow levels. I would expect today’s bank flow levels to be just a hair higher, maybe just sitting on top of that green-shaded area, given the push or spike above 1.6160 we’ve seen over the past several hours.
I wouldn’t be surprised to see the bank flow levels today sitting just on top of the green-shaded area, into the 1.6160s, 1.6170s, and 1.6180s for the GBPUSD today. As long as that does that, there’s potential for reversal to go back down towards the blue zone into our last area of support. Beyond that, we go all the way back down here into the yellow-shaded area.
Let’s take Fibonacci of this shortest leg of the trend range. I’m going to go from the low here, where it connects down here at the blue trend line, to the current high, which is this high that it made several hours ago. Taking Fibonacci measurement of this most recent trend range puts the .236 fib right here at 1.6000- that’s inside that blue-shaded area – and the .382 Fibonacci retracement level sits at 1.5890 – that’s the gold-shaded area. So, if it does, indeed, have some short-term reversal from the green zone, we have two Fibonacci target to shoot for back to the blue-shaded area, .236, back to the yellow-shaded area is the .382 Fibonacci retracement level.
So, let’s bring some black arrows in here to give us our expectation for today. Staying within or underneath this green-shaded area, I expect we’re looking for resistance, signs of reversal, and a turnaround to go back down towards the blue or the yellow-shaded area, as we see Fibonacci supports sitting down there of the most recent up trend leg for the trend. If it breaks above that green-shaded area with a clear open and close above 1.6160, likely looking for the continuation back to the mid-1.6200s. If we see a fall back down to the blue zone, we’ll watch for support down here, potential to buy it in the direction of the trend, or even a dip all the way back down here to the yellow-shaded area becomes an opportunity to buy in the direction of the trend.
So, watching for a breakout here either below 1.6130 to give us a clear view of 1.6000, or a break above 1.6160, looking for a turn back towards the 1.6200s for the GBPUSD today.
