The selloff on the British Pound was overdone last week.
The buyers came from 1.19 and bought heavily , closing the week around 1.22.
The weekly Kijun Sen ( 26 period mid price and a good gauge for a monthly fair price) and the Senkou Span B ( the 52 period mid price and long term Support/Resistance) are both flat.
This would encourage price to retrace. It is not likely that a full reversal of the current downtrend will occur , as the Bearish Kumo is well established.
Where will the retracement end ?
1. Small Push Back - When price moves out of equilibrium to far, it is invariably attracted back to the Tenkan Sen ( 9 period mid price). On the weekly chart this would be confluent with a Fibonacci 61.8 level retracement.
2. Larger Push Back - If price breaks the Tenkan Sen , then the likley target is the Kijun Sen.
Presently the British Pound is trading near historic lows. 1.19 has only been broken with Pandemic Low.
Price Range is likely a scenario for some time as 1.19 is a significant level for the Bears to breach.
The buyers came from 1.19 and bought heavily , closing the week around 1.22.
The weekly Kijun Sen ( 26 period mid price and a good gauge for a monthly fair price) and the Senkou Span B ( the 52 period mid price and long term Support/Resistance) are both flat.
This would encourage price to retrace. It is not likely that a full reversal of the current downtrend will occur , as the Bearish Kumo is well established.
Where will the retracement end ?
1. Small Push Back - When price moves out of equilibrium to far, it is invariably attracted back to the Tenkan Sen ( 9 period mid price). On the weekly chart this would be confluent with a Fibonacci 61.8 level retracement.
2. Larger Push Back - If price breaks the Tenkan Sen , then the likley target is the Kijun Sen.
Presently the British Pound is trading near historic lows. 1.19 has only been broken with Pandemic Low.
Price Range is likely a scenario for some time as 1.19 is a significant level for the Bears to breach.