GBP/USD Chartpack - Technicals & Trade Setup
Cable bulls shrug-off spinning top, shooting star and hanging man – Trade boundary strikes and short hedge as major downtrend imminent:
Technical chart and candlestick patterns: GBPUSD (cable) formed spinning top, shooting star and hanging man patterns at 1.3049, 1.3035 and 1.3053 levels on daily plotting. The minor trend developed sloping channel previously but the interim bulls have broken out channel resistance. Bulls seem to be shrugging-off above-stated bearish patterns (refer daily chart).
For now, although cable’s current price sentiments are attempting to build on the rebound from the lows of 1.2772 regions, the bullish sentiments in the minor trend is now hampered on above-stated bearish patterns overbought pressures.
On a broader perspective, we saw the resumption of major downtrend after brief consolidation phase, slumps below EMAs are observed upon shooting star formation.
For now, the trend is on the verge of retracing 78.6% Fibonacci levels as both leading and lagging indicators in tandem with selling sentiments & bearish EMA crossover.
Overall, current trend, for the day, is drifting in sideways with mild rallies but remember they can be deceptive as the upswings are likely to be restrained at 1.3203 (i.e. 21-EMA levels).
Trade tips: Well, on trading perspective, at spot reference: 1.3067 levels, contemplating above-explained technical rationale, it is advisable to trade barrier option strategy using boundary strikes, upper strikes at 1.3109 and lower strikes at 1.2990 levels, the strategy is likely to fetch leveraged yields as long as underlying spot FX remains between these strikes on expiry duration.
Alternatively, on hedging grounds, shorting futures contracts of mid-month tenors were advocated, now we wish to uphold the same position as the underlying spot FX likely to slide southwards 1.28 levels in the medium terms.
Writers in a futures contract are expected to maintain margins in order to open and maintain a short futures position.
Currency Strength Index: FxWirePro's hourly GBP spot index is inching towards 69 levels (which is bullish), while hourly USD spot index was at -61 (bearish) while articulating (at 05:51 GMT).
Technical chart and candlestick patterns: GBPUSD (cable) formed spinning top, shooting star and hanging man patterns at 1.3049, 1.3035 and 1.3053 levels on daily plotting. The minor trend developed sloping channel previously but the interim bulls have broken out channel resistance. Bulls seem to be shrugging-off above-stated bearish patterns (refer daily chart).
For now, although cable’s current price sentiments are attempting to build on the rebound from the lows of 1.2772 regions, the bullish sentiments in the minor trend is now hampered on above-stated bearish patterns overbought pressures.
On a broader perspective, we saw the resumption of major downtrend after brief consolidation phase, slumps below EMAs are observed upon shooting star formation.
For now, the trend is on the verge of retracing 78.6% Fibonacci levels as both leading and lagging indicators in tandem with selling sentiments & bearish EMA crossover.
Overall, current trend, for the day, is drifting in sideways with mild rallies but remember they can be deceptive as the upswings are likely to be restrained at 1.3203 (i.e. 21-EMA levels).
Trade tips: Well, on trading perspective, at spot reference: 1.3067 levels, contemplating above-explained technical rationale, it is advisable to trade barrier option strategy using boundary strikes, upper strikes at 1.3109 and lower strikes at 1.2990 levels, the strategy is likely to fetch leveraged yields as long as underlying spot FX remains between these strikes on expiry duration.
Alternatively, on hedging grounds, shorting futures contracts of mid-month tenors were advocated, now we wish to uphold the same position as the underlying spot FX likely to slide southwards 1.28 levels in the medium terms.
Writers in a futures contract are expected to maintain margins in order to open and maintain a short futures position.
Currency Strength Index: FxWirePro's hourly GBP spot index is inching towards 69 levels (which is bullish), while hourly USD spot index was at -61 (bearish) while articulating (at 05:51 GMT).