Trade Idea: GBP/USD – Sell At 1.6060
By Actionforex
GBP/USD – 1.6021
Most recent candlesticks pattern : N/A
Trend : Sideways
Tenkan-Sen level : 1.5968
Kijun-Sen level : 1.6063
Ichimoku cloud top : 1.6268
Ichimoku cloud bottom : 1.6178
Original strategy
Sell at 1.6060, Target: 1.5860, Stop: 1.6105
New strategy
Sell at 1.6060, Target: 1.5860, Stop: 1.6125
Although the British pound has continued to edge higher after rebounding from 1.5850 (this week’s low) and correction of recent decline to 1.6063/64 (current level of the Kijun-Sen as well as 50% Fibonacci retracement of 1.6277 to 1.5850) cannot be ruled out, reckon renewed selling interest would emerge there and bring another decline later. A break of yesterday’s low at 1.5904 would signal correction from 1.5850 has ended, then retest of this support and the recent low at 1.5832 would follow, once the latter support is penetrated, then the decline from 1.6879 should extend weakness to 1.5790/00 but previous chart point at 1.5708 should remain intact.
In view of this, we are still looking to sell cable on recovery for such a fall. Only above minor support at 1.6113 (previous support, Thursday’s low) would suggest low is in place, then correction to the Ichimoku cloud bottom (now at 1.6184) would follow.
GBPJPY Forecast 28January
Price: 146.02
Bias: While 145.50-60 supports we should see a retest at 147.28-45 before lower again
| Resistance | 146.13 | 146.44-74 | 147.28-45 | 147.81 | 148.48 | 148.72-00 |
| Support | 145.50-60 | 145.00 | 144.45 | 144.05 | 143.63 | 142.91 |
The underlying MT direction is bearish while the daily bias is bullish. Therefore it is likely that any gains are corrective only. Note resistance levels that could stall any rally. Consider bearish set up patterns at key resistance levels or should price threaten to break below any key support levels that would indicate a possible resumption of the move lower. Only consider a possible larger reversal higher should key MT resistance break.
Consider buy set ups at: 145.50-60 or 146.13-20
Consider sell set ups at: 147.28-45 or 145.40
Daily Bullish
Yesterday saw the 143.63 low hold and we have seen strength since then. I feel we do have a little more to go. While 146.13 caps we should see a shallow pullback that should hold above the 145.50-60 area. From there I feel we will see extension back above 146.13 and then through the 146.44-74 corrective highs to then revisit the 147.28 corrective high and maximum 147.45… I feel this will cap for losses. Thus only above 147.50 would maintain the bullish momentum for a move through 147.81 & 148.48 en route the 148.72-00 area.
Medium Term Bullish
28th January: I feel that the 147.28-45 area can be retested but should hold. Only breach would extend gains to 148.72-00 initially.
Daily Bearish
I remain bearish overall but feel we are more likely to see a retest of 147.28-45 first. Look for a bearish trade set up here. Only an earlier break below the 145.50-60 pivot support would cause earlier reversal lower through 145.00 and to 144.45, 144.05 and back to teh 143.63 low. I suspect it should hold on first test but note lower targets then at 142.91 minimum and probably 142.14-45…
Medium Term Bearish
27th January: We’ll need a break of the 143.74-144.07 area to extend to 142.14-45 at least. Next support is at 141.60-85… and if seen it will raise the risk of a retest of the 139.30 low
Ian Copsey
FX-Forecaster