GBP/USD Candlesticks and Ichimoku Analysis
By actionforex
GBP/USD – 1.6025
| Last Candlesticks pattern | Time of formation | Trend bias | |
| Weekly | Shooting star | 5 Aug 2009 | Up |
| Daily | Hammer | 3 Nov 2009 | Sideways |
The British pound continued to move lower after recent fall from 1.6879 and price dropped to as low as 1.5923 last week (almost reached our indicated downside target at 1.5900) and although marginal fall below said support is likely, support at 1.5708 should hold on first testing and cable shall stay within recent established range of 1.5708-1.7044 for the last trading week of 2009.
On the upside, whilst recovery to 1.6160/70 cannot be ruled out, renewed selling interest is likely to emerge around 1.6288 (38.2% Fibonacci retracement of 1.6879 to 1.5923) and price should falter well below the Kijun-Sen (now at 1.6375), bring another decline later. Only a daily close above 1.6400-12 (current level of the Tenkan-Sen and previous resistance would suggest the fall from 1.6879 has ended.
On the daily chart, the British pound fell in line with our expectation and indicated downside target at 1.5972 (1.236 times projection of 1.6879-1.6272 measuring from 1.6722) has been met and price did stay above calculated support at 1.5857 (100% projection of 1.6722-1.6167 measuring from 1.6412) and recovered from 1.5923. Therefore, expect initial recovery to be seen this week and whilst retracement to the Tenkan-Sen (now at 1.6167, also the same level as previous support) cannot be ruled out, reckon Ichimoku cloud bottom (now at 1.6293) would limit upside and the Kijun-Sen (now at 1.6334) should hold.
On the downside, below 1.5923 support would extend weakness towards 1.5857 (100% projection of 1.6722-1.6167 measuring from 1.6412), however, loss of near term downward momentum should prevent sharp fall below 1.5800 and the British pound shall stay above support at 1.5708 and bring further choppy consolidation within early established range of 1.5708 – 1.7044.
Did you enjoy this post? Why not leave a comment below and continue the conversation, or subscribe to my feed and get articles like this delivered automatically to your feed reader.
Comments
No comments yet.
Leave a comment