DAILY TECHNICAL OUTLOOK ON GBP/USD
01 Nov 2013 01:34GMT
Trend Daily Chart Sideways
Daily Indicators Turning down
21 HR EMA 1.6041
55 HR EMA 1.6053
Trend Hourly Chart Near term down
Hourly Indicators Neutral
13 HR RSI 49
14 HR DMI -ve
Daily Analysis Consolidation with downside bias
1.6165 - Hourly res, Oct 28
1.6119 - Last Wed's low, now res
1.6079 - Y'day's high
1.5999 - Y'day's low
1.5940 - Oct 17 low
1.5894 - Oct 16 low
. GBP/USD - 1.6025... Despite initial weakness to 1.6006 ahead of European opening, failure to penetrate Wed's low at 1.5999 prompted active short-covering n price rebounded to 1.6070 due to cross-buying of gbp vs eur in NY morning. However, renewed selling interest pushed cable back down to 1.6031 nr NY close.
. The outlook remains pretty much the same as our prev. update. Looking at the daily n hourly charts, this week's selloff to 1.5999 (Wed) suggests near
term rise fm 1.5894 (Oct 16 low) has ended at 1.6258 last Wed n consolidation below Oct's near 9-month high at 1.6260 wud continue with downside bias. The price action fm 1.6260 cud also be unfolding into a triangle (a-leg at 1.5894, b-leg 1.6258 n present decline is the c-leg), if this view holds true, then then 2-3 more weeks of choppy sideways trading is in store.
. Today, in view of abovementioned scenario, we are holding short for weakness to 1.5975, however, 1.5964 (80.9% r of 1.4894-1.6258) wud hold n yield recovery. On the upside, only abv 1.6119 wud abort bearishness on the pound n risk stronger gain to 1.6165 next week.
*** T.G.I.F. ***