This looks like Cable could remain bullish for some time, I have been keeping an eye on the fundamentals also, due to the FOMC being a bit unclear today the trend was neither decisively broken nor strengthened.
Market sentiment is bearish in some places and still bullish in others, long term suggestions would be very appreciated.
So far I am quite conscious due to the fact that GBP/USD appears to be in a risky region.
Cable has fallen by a few pips since, but Cable seems to have strong long term weekly movements rather than daily ones.
Choice is yours, depending on which time frame you like to trade; ADX indicator on Day chart shows that GBP/USD is not trending at present, being under the value of 25… You can still make money out of the channel, though, which is what I intend to do.
I’m quite bad at channel trading with cable I did well with AUD/USD, but maybe it was a fluke.
I actually thought cable was going to be ranging weekly and was ready to short on the uptrend resistance line, but I was hesitant because of the heretofore upcoming FOMC.
I usually check my position weekly with cable, however I have been checking frequently now.
GBP was showing some signs of resiliency for the past month or so, but last week there were comments from BoE’s Weale bringing attention for potentially more QE in the UK. According to the bank reports, sentiment is starting to turn against GBP especially as more attention is paid to buying USDs. This one mentions GBP as being overvalued, this one specifically calls into attention the comments by Weale
You can see that after a nice little surprise positive GDP reading out of the UK that price rallied at first but fell off hard afterward. We have BoE’s Carney speaking this week which could help weaken GBP further if more talk of a potential need for QE continues.
GBP is being viewed as bearish and overvalued by the banks and price action is starting to confirm that. Shorter-term tech guys are starting to shift from neutral to negative and medium-longer term tech guys probably seeing mixed/neutral action. Honestly I’d say all in all GBP is pretty negative, especially looking at GBP/USD since USD will likely appreciate into mid-September. After the FOMC meeting would be a good time to re-assess it all
Thanks, you are pretty far ahead of me with this, your advice is appreciated I went short when cabe could not hold the plateau at around 1.567 after the FOMC.
I suppose on that level I was only using basic technical analysis. I will also look at the opinions of global banks aswell from now on when considering long term movements.
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I would advise we recognize that Regulation reduces the enjoyable plurality of the market. With several economic recipes (regulated, unregulated brokers), it is a delicious concoction for investors to eat. Why spoil the taste by reducing the ingredients calling some brokers unclean all in the name of regulation. It is high time the FX public put these Bullying regulatory bodies in their small space.
Glad to help. If you notice the sharp rally in G/U yesterday, that happened after Carney’s speech was dovish, but the market expected even more. That’s how negative GBP was being viewed going into that speech. Since he couldn’t deliver even MORE dovish than he did (and it was very dovish), many shorts exited at that point. But all in all, things aren’t looking so hot for GBP right now
To the earlier post by pipmehappy, if I am looking to hold positions for a few days , should my long term timeframe be weekly or daily? Similarly should the timeframe I trade in be daily or 4 hourly?
I am a part timer and only look at the charts at night after work for 2 hrs.
Dear Mav, as I am a part-time, after work “trader” (still on demo), I understand your time restraints; while it is not easy to keep flicking between time frames, the general advice is to keep going to the next time frame up until you find confirmation of an overall trend. However, if you are an intra-day trader and you like to close your trades by the end of the day, then looking at a 4h and Daily time-frames should give you enough opportunity to spot movements both in the medium and shorter term. Personally, I also look for movements in the shorter time frames, for example if I were assessing the movement of a pair in the first ten minutes after a major piece of event risk (e.g. NfP for USD pairs). Be flexible with your time frames, as on quieter days/weeks it may be pointless to keep your eyes on a daily chart if you want shorter-term opportunities, like trading a range within a channel (see the recently broken Eur/Usd rising channel, much more visible in the 4h chart than in a Daily or Weekly chart). I hope this makes some sense… Happy trading.
If you notice the sharp rally in G/U yesterday, that happened after Carney’s speech was dovish, but the market expected even more. That’s how negative GBP was being viewed going into that speech. Since he couldn’t deliver even MORE dovish than he did (and it was very dovish), many shorts exited at that point. But all in all, things aren’t looking so hot for GBP right now