Weekly gain/loss: +0.94%
Weekly closing price: 1.3848
The British pound was, once again, seen flexing its financial muscle last week, cruising to a fresh high of 1.3944. While the unit chalked up its fifth consecutive weekly gain, price has shook hands with a weekly AB=CD (see black arrows) 161.8% Fib ext. point at 1.3861. A push above this line would, technically speaking, expose a weekly broken Quasimodo line at 1.4079 and likely motivate further upside. A rejection from the current line, however, has the weekly support band at 1.3683 to target.
Turning our focus to the daily timeframe , resistance at 1.3878 came into play on Wednesday, but we only really saw the sellers make a play from here going into Friday’s close, despite the threat of a US governmental shutdown. This level, as far as we’re concerned, adds weight to the aforementioned weekly AB=CD formation.
Moving across to the H4 scale, we can see that price failed to sustain beyond the 1.39 handle on Friday. After putting in a top at 1.3945, slightly above Wednesday’s high at 1.3942, sentiment turned sour. Aggressively reclaiming 1.39, the GBP/USD concluded the week closing marginally beyond the H4 mid-level support at 1.3850.
Market direction:
Structurally, the GBP could be headed for further losses this week.
As for potential setups, we do not see much to hang our hat on right now. A decisive H4 close beneath 1.3850, while considered a bearish signal, is a restricted sell, in our view, due to the nearby H4 demand (green arrow) printed just ahead of the 1.38 handle at 1.3804-1.3833.
Data points to consider: No high-impacting events on the docket today.
Areas worthy of attention:
Supports: 1.3850 (potential); 1.38 handle; 1.3683.
Resistances: 1.39 handle; 1.3861; 1.3878; 1.4079.
Weekly closing price: 1.3848
The British pound was, once again, seen flexing its financial muscle last week, cruising to a fresh high of 1.3944. While the unit chalked up its fifth consecutive weekly gain, price has shook hands with a weekly AB=CD (see black arrows) 161.8% Fib ext. point at 1.3861. A push above this line would, technically speaking, expose a weekly broken Quasimodo line at 1.4079 and likely motivate further upside. A rejection from the current line, however, has the weekly support band at 1.3683 to target.
Turning our focus to the daily timeframe , resistance at 1.3878 came into play on Wednesday, but we only really saw the sellers make a play from here going into Friday’s close, despite the threat of a US governmental shutdown. This level, as far as we’re concerned, adds weight to the aforementioned weekly AB=CD formation.
Moving across to the H4 scale, we can see that price failed to sustain beyond the 1.39 handle on Friday. After putting in a top at 1.3945, slightly above Wednesday’s high at 1.3942, sentiment turned sour. Aggressively reclaiming 1.39, the GBP/USD concluded the week closing marginally beyond the H4 mid-level support at 1.3850.
Market direction:
Structurally, the GBP could be headed for further losses this week.
As for potential setups, we do not see much to hang our hat on right now. A decisive H4 close beneath 1.3850, while considered a bearish signal, is a restricted sell, in our view, due to the nearby H4 demand (green arrow) printed just ahead of the 1.38 handle at 1.3804-1.3833.
Data points to consider: No high-impacting events on the docket today.
Areas worthy of attention:
Supports: 1.3850 (potential); 1.38 handle; 1.3683.
Resistances: 1.39 handle; 1.3861; 1.3878; 1.4079.
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