ICmarkets

GBP/USD: Technical outlook and review.

FX:GBPUSD   British Pound / U.S. Dollar
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4hr TF.

The higher-timeframe picture resembles the following:

• Weekly TF: Over the past few weeks, serious selling has been seen from the weekly supply area at 1.76297-1.67702, which consequently saw price closing below a weekly demand area last week at 1.66917-1.67935. The path south is now likely free to trade lower down to around weekly demand at 1.64589-1.66339.

• Daily TF: A retest is now being seen of the daily D/S flip area at 1.67367-1.68440; this retest could very well be all the sellers need to push down into daily demand at 1.65492-1.66044, which would consequently bring prices into the weekly demand area mentioned above.

Whoa! Weekend trading has seen the pound jump up in value above the round number 1.67, with the market opening above Friday’s close (1.66876) at 1.67291.

This appreciation in value has forced prices to hit active sell orders around the 4hr D/S flip area at 1.67389-1.67561 (conveniently located within a daily D/S flip area at 1.67367-1.68440) where price is currently seen consolidating below at the time of writing. If the sellers do intend on bringing price south from here, the first trouble area on the horizon is likely going to be the round number 1.67, as a lot of traders will be looking to play the retest north, which will consequently close the weekend gap, so a close below here is what we’re ideally looking for.

Pending orders/P.A confirmation levels:

• No pending buy orders (Green line) are seen in the current market environment.
• No P.A confirmation buy levels (Red line) are seen in the current market environment.

• No pending sell orders (Green line) are seen in the current market environment.
• The P.A confirmation sell level (Red line) set just below the round number 1.67 at 1.66961 has now been removed since price traded too far above the entry level for the time being.
• The P.A confirmation sell level (Red line) set just below the 4hr D/S flip area (1.67389-1.67561) at 1.67327 is now active and awaiting confirmation. For this area to be confirmed we would like to see the sellers break price below the low marked with an arrow at 1.66757, only then will we consider setting a pending sell order in the market.

• Areas to watch for buy orders: P.O: No pending buy orders are seen in the current market environment. P.A.C: No P.A confirmation buy levels are seen in the current market environment.

• Areas to watch for sell orders: P.O: No pending sell orders are seen in the current market environment. P.A.C: 1.67327 (Active-awaiting confirmation) (SL: Dependent on price action after the level has been confirmed TP: Dependent on approaching price action after the level has been confirmed).

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