British Pound Crosses To Test Important Resistance Levels

-GBPCHF pressures year to date high
-GBPCAD target above 1.8500
-GBPAUD RSI divergence favors bulls

British Pound / Swiss Franc[/B]

A triangle remains possible but the GBPCHF is pressuring the high to date and a push above (1.7496) would expose the 200 day SMA at 1.7731. This looks likely and strength could persist to the 100% extension of the rally from 1.5113-1.7496; which is at 1.8338. Long term, I still maintain that a 5th wave will complete the entire decline from the 2007 top. This forecast is valid as long as price is below 1.9369.

British Pound / Canadian Dollar[/B]

Last week, I wrote that “there is a good chance that a flat is complete. Favor the upside against Monday’s low. The objective is above 1.8500.” There is no change to the outlook.

British Pound / Australian Dollar[/B]

Divergence with RSI at the recent low favors GBPAUD strength. Initial resistance is at 2.0912 but a much larger advance is possible. The low this month at 1.9688 is the lowest the pair has been since October 1996. Since 2996, the pair has traded in a range spanning over 10,000 pips (roughly 1.8800 to 3.0000). Nearing the lower end of the range recently, a bounce at the very least should not come as a surprise.

British Pound / New Zealand Dollar[/B]

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.

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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