GBP/USD interim bulls in range, well below 7-EMA, major bear trend still appears to be intact – Deploy DCPS to speculate:
The interim bulls are performing well from the recent past, upswings from the lows of 1.2205 are now drifting in sideways (see weekly and daily plotting), on the contrary, the major downtrend still remains intact (see monthly chart).
Entire universe knows the intensity of the bearish trend of GBPUSD (tumbled more than 25% in just 2 and odd years).
Rallies may extend but bulls attempts restrained within range 7EMA, rallies likely to see the stiff resistance of 1.2859. So, we think more bearish rout underway as we see no bullish substantiation from any other technical indicators.
But we reiterate that in the last couple of weeks, the attempts of bull-swings take the short term trend in sideways.
But RSI & Stoch are indicative of further dips on monthly charts, whereas RSI on weekly terms has been indecisive but slightly bulls’ favor (trending in the linear direction above 31 levels).
Slow stochastic on the other hand noises with the attempts of %K line cross over even below oversold region on monthly terms but no convincing bullish momentum.
On long-term perspectives, dipping prices, Massive volumes, leading & lagging indicators still signal weakness..! What else is required to confirm major downtrend?
While the current prices on this plotting are well below EMAs.
Hence, contemplating above technical reasoning, although there are short-term buying opportunities, we would still foresee further GBP weakness in medium terms, as a result, we recommend the below option strategy to monitor the puzzling swings.
Trade tips:
Well, capitalizing on upswings, we recommend deploying “credit put spreads”, any continued upswings should not be panicky, instead, use them for writing expensive ITM put options.
So, short 1W (-1%) in the money put with positive theta if you expect that GBPUSD would spike up moderately over the next near future but certainly not beyond your imagination, simultaneously, buy next month at the money -0.49 delta put option.
The interim bulls are performing well from the recent past, upswings from the lows of 1.2205 are now drifting in sideways (see weekly and daily plotting), on the contrary, the major downtrend still remains intact (see monthly chart).
Entire universe knows the intensity of the bearish trend of GBPUSD (tumbled more than 25% in just 2 and odd years).
Rallies may extend but bulls attempts restrained within range 7EMA, rallies likely to see the stiff resistance of 1.2859. So, we think more bearish rout underway as we see no bullish substantiation from any other technical indicators.
But we reiterate that in the last couple of weeks, the attempts of bull-swings take the short term trend in sideways.
But RSI & Stoch are indicative of further dips on monthly charts, whereas RSI on weekly terms has been indecisive but slightly bulls’ favor (trending in the linear direction above 31 levels).
Slow stochastic on the other hand noises with the attempts of %K line cross over even below oversold region on monthly terms but no convincing bullish momentum.
On long-term perspectives, dipping prices, Massive volumes, leading & lagging indicators still signal weakness..! What else is required to confirm major downtrend?
While the current prices on this plotting are well below EMAs.
Hence, contemplating above technical reasoning, although there are short-term buying opportunities, we would still foresee further GBP weakness in medium terms, as a result, we recommend the below option strategy to monitor the puzzling swings.
Trade tips:
Well, capitalizing on upswings, we recommend deploying “credit put spreads”, any continued upswings should not be panicky, instead, use them for writing expensive ITM put options.
So, short 1W (-1%) in the money put with positive theta if you expect that GBPUSD would spike up moderately over the next near future but certainly not beyond your imagination, simultaneously, buy next month at the money -0.49 delta put option.
