Hi guys, wondering if someone can help me out with my cable analysis.
So far my analysis is like this…
Daily – downtrend for over a month - bearish
4h – downtrend - bearish
1h – ranging for the last few days
I have labelled various points on the chart with numbers. These areas stood out to me.
Point 1: Continuation of downtrend. Large volume combined with large candle. Overall strong selling.
Point 2: Pullback. Price testing previous support turned resistance. Large wick on top of candle combined with large volume. Sellers have come in. Therefore still bearish.
Point 3: Large down candle with large volume. Strong selling.
Point 4: High volume combined with small body candle and large wick on the bottom. Strong buying.
Point 5: High volume on an up candle. However next couple of bars afterwards retrace it. Sellers still active. Range intact.
Point 6: Very high volume, medium-sized down candle but next candle is then a small body candle with large wick on the bottom. Buyers absorbed the selling? Possible strength from buyers.
Point 7: Three strong volume bars. Price moves up but then sellers come in pushing it back down to bottom of the range again.
Point 8: Strong volume, small body down candle with large wick on top. Strong selling.
Point 9: Strong volume, small body candle with wick on the bottom. Strong buying. The next volume bars are also quite strong and price doesn’t continue to move down. Sellers can’t take it lower.
Point 10: Large volume combined with strong up bar. Then large volume and large down bar. Buyers and sellers still battling it out near the top of the range.
Point 11: After price moves down a bit, suddenly we get this massive up bar but the volume is very small. No real strength behind that move.
So overall what I’m feeling is that GBPUSD has been in a downtrend for over month now. What that says to me is that I should be expecting a reversal at some point. However, I always trade with the trend and at the moment trend is down. Having said that, GBPUSD has been in a range on the 1h for the last few days. Buyers are standing their ground at the bottom of the range and sellers are holding the top of the range. Could this be a possible bottom? I don’t know. Maybe the best move here is to wait for a breakout and retest and see if the scenario has changed.