I think it'll either bounce off the warning line (WL - blue dotted) it's grinding along , or flush slightly below prior horizontal resistance @1.614 (red dotted). Just after the Asian open on Monday, it would be easy to flush it down through the resistance, take out the stops of Euro/US muppet-longs hidden just below, before bouncing it back up. Such is life in C21.
The midpoint of a large ABCD pattern coincides with the prior high @1.6259, making it a logical TARGET, although resistance is also likely at the intervening WLs. I suspect neither the BoE or FED would be happy with it breaking out above those highs, so resistance there could be fierce.
If there's no flush down, ENTER at the paler blue sliding parallel (@~1.618; 6:1 RRR) if it makes it to the prior high - though two WLs, and a couple of SPs I haven't marked could present resistance and/ PROFIT TAKING opportunities. STOP @ WL (~1.615)
On a flush, the current WL could be an ENTRY point, allowing a margin for error (perhaps @1.615). STOP just below flush low.
Anyway, I'm just making this stuff up ;) Best of luck!
Comments
ForceFollower
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As for the pound's strength, my reading is that it depends on the following factors:
1) Is the low at 1.614 going to hold? I have a bad feeling about it, but it is possible.
2) How is the pound going to fare against the euro? If the high at 0.8495 gets taken out, the pound is probably going to weaken across the board.
Other than that I am bullish about GBPUSD, looking to enter long somewhere around 1.606.
cryptoyoda
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Now that you mention it, I realise I had no good reasons argue 16.14 would hold. But it occurred to me check the tape, and this is what's happening at 16.1550:
imgur.com/zm4NtS8 In word: there's a 1M order at 550, and a 4m order at 545. Sellers sold at market taking out the 1M order about *17* times in one second (16.37.27 - I guess EST?). EACH TIME, a buyer/buyers reinstated the order at 550. Buyers eventually came back making market buy orders then bidding at higher levels, the sellers retreated to 575, with a 8m total ask orders there. That was bought down to nothing in 15 seconds, and by 16.38.43 bid ask was 595-600. (Next screen; I'll post it if you like.)
I'm still trying to figure out exactly what the different 'constellations' on the tape mean, but I've noticed something like that before, and, I think that is what resistance looks like.... So I think 16.1550 is pretty solid for now. Maybe if it gets hit a couple more times the sellers can exhaust the buying there though. I guess news could change those buyers' minds too.
ForceFollower
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Anyway, be cautious during the unusual NFP announcement on Tuesday. Do you have access to the economic calendar?
cryptoyoda
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Ah yes, shutdown over :p I wonder which datapoints they'll be able to release...
I think there are various calendars about online. But I'm just trying to find my way with the charts (& to a lesser extent tape) at the moment...
ForceFollower
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Hey, trading is a vast enterprise. It's not just charts, tape reading, technical analysis - you'll find your way, you're very good at it indeed. But first and foremost it's 'running' YOURSELF and second - it's position-SIZE management while trading with REAL money. You need to have every puzzle neatly mesh with the other. It's OK, even if you're wrong with the lines or the levels, as long as:
1) you're right with the DIRECTION,
2) know what your RISK is and
3) know when to EXIT ("know when to run").
That's why I: follow the force (ie. big trend), risk 1% on every trade and... run with the profit I like or the loss I don't like. :-)
cryptoyoda
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Yes indeed. So my approach is to try to break it down into manageable bits; TV has let me try out doing TA of a kind I think makes sense on an easy-to use platform and equally importantly get some feedback on it. (Which I very much appreciate - thank you :)
I'm figuring out (/trying to) the next steps at the moment :p
Oops - other reasons I think GBPUSD is running out of steam: smaller rallies, longer consolidations after rallies. See green arrows and range bars below:
1) Is the low at 1.614 going to hold? I have a bad feeling about it, but it is possible.
2) How is the pound going to fare against the euro? If the high at 0.8495 gets taken out, the pound is probably going to weaken across the board.
Other than that I am bullish about GBPUSD, looking to enter long somewhere around 1.606.