GBP/USD technical outlook
GBP/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Bottoming at lows not seen since the 1980s, ahead of a 127.2% Fib ext. level at 1.1297, March’s candle is staging an impressive recovery and has regained approximately 50% of the month’s losses.
Support at 1.1904/1.2235 may, despite having its lower edge shattered, remain relevant should price close the month above its base. Nearby resistance can be seen in the form of a trendline formation (1.7191).
Daily timeframe:
Partially altered from previous analysis -
Trendline supports drawn from 1.2373 and 1.2041 continue to serve as a technical ‘floor’ in this market, with price recently going toe-to-toe with an interesting area of supply from 1.2212/1.2075. In light of a lacklustre response out of the said supply, traders are urged to pencil in the possibility of moves materialising towards supply at 1.2509/1.2372.
The RSI indicator is seen turning higher from lows at 17.00, currently gaining a foothold above 30.00. The 200-day SMA has also begun turning lower after flattening since November 2019.
H4 timeframe:
UK retail sales as well as the BoE meet was largely overlooked Thursday, with the majority of eyes on the dollar’s decline over rising US jobless claims as a result of the coronavirus spread.
Dollar weakness fuelled a spirited advance through fresh supply around 1.2136/1.2049 into the walls of another layer of supply drawn in at 1.2273/1.2198, stationed just beneath a 161.8% Fib ext. level at 1.2279 and a 50.0% retracement at 1.2282. Scoring additional gains on this timeframe may lead to supply at 1.2622/1.2517 making its debut, resting a few points above a 61.8% Fib retracement at 1.2499.
H1 timeframe:
Following a fleeting retest at 1.19, GBP/USD caught a fresh bid into London Thursday, slaughtering 1.20 and 1.21 until confronting supply from 1.2245/1.2192 amid US afternoon trade, which encapsulates 1.22. Sellers currently face channel resistance-turned support (1.1972), with a break of here exposing 1.21 as potential support. Upside beyond the current supply has 1.23 in the firing range, a level which offered reasonably sound S/R mid-March.
Concerning the RSI indicator, momentum appears to be slowing after dipping from peaks at 78.00 to a few points below 70.00.
Structures of Interest:
H1 supply failure at 1.2245/1.2192 has 1.23 in sight; the daily timeframe, nonetheless, suggests moves beyond 1.23 are possible, with the lower edge of daily supply coming in at 1.2372. Though do bear in mind, entering long above 1.2245 still faces opposition from H4 supply at 1.2273/1.2198.
Seeking bearish themes on a close beneath the current H1 channel support is challenging as the top edge of supply-turned demand at 1.2136/1.2049 on the H4 timeframe leaves little room to manoeuvre.
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
Bottoming at lows not seen since the 1980s, ahead of a 127.2% Fib ext. level at 1.1297, March’s candle is staging an impressive recovery and has regained approximately 50% of the month’s losses.
Support at 1.1904/1.2235 may, despite having its lower edge shattered, remain relevant should price close the month above its base. Nearby resistance can be seen in the form of a trendline formation (1.7191).
Daily timeframe:
Partially altered from previous analysis -
Trendline supports drawn from 1.2373 and 1.2041 continue to serve as a technical ‘floor’ in this market, with price recently going toe-to-toe with an interesting area of supply from 1.2212/1.2075. In light of a lacklustre response out of the said supply, traders are urged to pencil in the possibility of moves materialising towards supply at 1.2509/1.2372.
The RSI indicator is seen turning higher from lows at 17.00, currently gaining a foothold above 30.00. The 200-day SMA has also begun turning lower after flattening since November 2019.
H4 timeframe:
UK retail sales as well as the BoE meet was largely overlooked Thursday, with the majority of eyes on the dollar’s decline over rising US jobless claims as a result of the coronavirus spread.
Dollar weakness fuelled a spirited advance through fresh supply around 1.2136/1.2049 into the walls of another layer of supply drawn in at 1.2273/1.2198, stationed just beneath a 161.8% Fib ext. level at 1.2279 and a 50.0% retracement at 1.2282. Scoring additional gains on this timeframe may lead to supply at 1.2622/1.2517 making its debut, resting a few points above a 61.8% Fib retracement at 1.2499.
H1 timeframe:
Following a fleeting retest at 1.19, GBP/USD caught a fresh bid into London Thursday, slaughtering 1.20 and 1.21 until confronting supply from 1.2245/1.2192 amid US afternoon trade, which encapsulates 1.22. Sellers currently face channel resistance-turned support (1.1972), with a break of here exposing 1.21 as potential support. Upside beyond the current supply has 1.23 in the firing range, a level which offered reasonably sound S/R mid-March.
Concerning the RSI indicator, momentum appears to be slowing after dipping from peaks at 78.00 to a few points below 70.00.
Structures of Interest:
H1 supply failure at 1.2245/1.2192 has 1.23 in sight; the daily timeframe, nonetheless, suggests moves beyond 1.23 are possible, with the lower edge of daily supply coming in at 1.2372. Though do bear in mind, entering long above 1.2245 still faces opposition from H4 supply at 1.2273/1.2198.
Seeking bearish themes on a close beneath the current H1 channel support is challenging as the top edge of supply-turned demand at 1.2136/1.2049 on the H4 timeframe leaves little room to manoeuvre.
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