Classical example of Channel rotation which is supported by other underlying markets.
After a massive break to the downside it has been a few days that GBP has been retracing but the question is whether it is the time to be bearish on pound and I would say YESSS!!!
Here are the reasons. Starting with Pound first
1) This is UK Gilts 10yrs, opposite relationship is expected between FX and Gilts.
See where we are now? It is bouncing off the supports
2) This is UK Bonds 10yrs. positively correlated with FX.
Almost got to the resistance and pulling back now hence pound falling.
3) This is FTSE 100. Just made all time highs and after touching 23% Fibo heading higher.
If FTSE make a higher high again we should see Pound falling futher.
All indices are up. See the weighted averages for CAC, DAX, FTSE, EUSTX50, FTSEMIB, NIKEI and NIKKEI futures.
4) This is pound Bonds. Heading up means pound will be falling. More debt bad for currency right?
See the cycling lines in all charts above. They all suggest a major swing low or high for today!
5) Pound futures, Just look at the bearish engulfing candle here!
6) This is weighted average pound.
Pulling back after touching EMAs and Fibos and Resistance.
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Order pending at highs to add...
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Just look at the wicks on BXY. I forgot to add this !!
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I am just watching this Flag on Weighted average USD and once it makes a higher high, I would go Short GBPUSD. Another classic example of breaking a flag in the wrong side on the first attempt. TNX and ZB1! and US10 (y) confirms it.
To be honest I was waiting for GBPUSD short but then EURGBP Long came first ...
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Lots of SLs around 0.88434 after that there is no resistance. Also good scalping opportunity.
Hope you are having a good weekend Khan sir, are you in the trade or thinking to initiate a position? thanks.
khansalarehsan
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@harty10, Thanks, I am not very positive about this trade. You may want to exit with minimum loss if you like...
harty10
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@khansalarehsan, Thank you for your reply, I am not in this trade.
fxau
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Thanks khan! Been on GBP/USD since 1.33 with my first full contract LIVE trade!! What a ride ! So do you think it'll make the original target of 1.31710? Or should I pull out earlier than that? Hope you don't mind another stupid newbie question but on this long journey with the GBP/USD short I noticed that there were quit a few opportunities to place "long" day trades that would have made a nice profit. However the broker I'm using, IG, wont let you hedge trades on the same deal. Do you know if there's a way to do this with these long intra day trades?
Thanks so much for your in depth analysis !! I've learnt so much from your ideas!! Much much more than the past 3 months I've been in demo mode!!
Cheers!!
khansalarehsan
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It is a great pleasure to hear that you found my analysis useful. I think GBPUSD is a short and I will send a post shortly about that. You will find out more in the post...@fxau,
fxau
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@khansalarehsan, Yes GBPUSD is short. I'll keep an eye out for your post. Thanks again
assetgem2
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On the EURGBP i would wait till it gets to 0.87966 and then go long. It has reached Resistance at 0.88405 on the 4 hr chart.
khansalarehsan
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That make sense my friend. It is also safer... GL @assetgem2,