British Pound Crosses: Confined to Ranges

British Pound / Swiss Franc

The GBPCHF has traded to the 200 day SMA and reversed slightly. Strength could persist to the 100% extension of the rally from 1.5113-1.7496; which is at 1.8338. Potential resistance prior to this is 1.7966, which is the 38.2% of the decline from 2.0820. Long term, I still maintain that a 5th wave will complete the entire decline from the 2007 top but some additional upside in wave 4 seems likely.

British Pound / Canadian Dollar

Last week, I wrote that “there is a good chance that a flat is complete. Favor the upside against Monday’s low (1.7378). The objective is above 1.8500.” Today’s sharp reversal dampens confidence in the near term bullish outlook. The range that has held since February continues to do so. Until a break of the range, confidence in direction is low.

British Pound / Australian Dollar

Divergence with RSI at the recent low favors GBPAUD strength as does the push through trendline resistance. MACD (daily) is very close to turning positive as well. Initial resistance now is at 2.0912 but a much larger advance is possible. The pair is at the lower end of a decade + range. It is worth noting that May’s candle sports a long wick and small body. This is the type of candle that is usually seen at bottoms.

British Pound / New Zealand Dollar

A multi-year triangle is likely complete at 2.8968. Confirming completion of the triangle is the decline from 2.8968, which exhibits the 5 wave impulse pattern. An expanded flat is probably underway now that will end above 2.6498. Favor strength from here and a possible test of Fibonacci resistance at 2.7340.

[I]Jamie Saettele publishes Daily Technicals every weekday morning (930 am EST), COT analysis (published Monday mornings), technical analysis of currency crosses throughout the week (EUR on Tuesday, JPY on Wednesday, GBP on Thursday, AUD on Friday), and the DFX Trend Index every day after the NY close. He is also the author of Sentiment in the Forex Market.

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