GBP Technical Analysis

Talking Points:

• GBP/JPY Technical Strategy: Flat
• Support: 172.13 (50% Fib exp.), 171.49-64 (38.2% Fib exp., Triangle floor)
• Resistance:172.76 (61.8% Fib exp., Triangle top), 173.55 (76.4% Fib exp.)

The British Pound continues to look for clear-cut direction cues against the Japanese Yen, with prices consolidating in a large Triangle chart formation. Near-term support is at 172.13, the 50% Fibonacci expansion, with a break below that targeting the intersection of the 38.2% level and the Triangle bottom in the 171.49-64 area. Alternatively, a daily close above the 172.76 – marked by the 61.8% Fib and the Triangle top – initially exposes the 76.4% expansion at 173.55.

On balance, a Triangle pattern typically implies trend continuation, which carries bullish implications in this case. Confirmation is absent without a clear-cut break above the formation’s upper boundary however. With that in mind, we will continue to stand aside for now.




--- Written by Ilya Spivak, Currency Strategist for DailyFX.com



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Talking Points

• GBP/USD Technical Strategy: Sidelines Preferred
• Key support remains at the critical 1.6820 mark
• Piercing Line pattern hints at a bounce in intraday trade

GBP/USDhas bounced off key support at 1.6820 after posting some modest declines on the back of a Harami candlestick pattern. Given the absence of a bullish reversal signal on the daily and nearby resistance at 1.6900, the pair may struggle to continue its recovery.

GBP/USD: Struggles Below 1.6900 Following Harami Pattern




As noted in yesterday’s report the Evening Star pattern on the four hour chart hinted at a drop for GBP/USD during the session. The emergence of a Piercing Line formation near support at 1.6820 now suggests a recovery may be on the cards. Given noteworthy resistance looms at 1.6900, follow-through may prove limited.

GBP/USD: Piercing Line Puts Bounce On The Cards



By David de Ferranti, Market Analyst, DailyFX

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Talking Points:

• GBP/JPY Technical Strategy: Short at 172.26
• Support: 169.86 (38.2% Fib ret.), 168.71 (50% Fib ret.)
• Resistance:171.27 (23.6% Fib ret.), 172.82 (triple top)

The British Pound rebounded against the Japanese Yen after turning downward as expected but gains appear to be corrective. Resistance is marked by a trend line cluster in the 171.91-172.07 area, with a break above that on a daily closing basis exposing a triple top at 172.82.Near-term support is at 169.86, the 38.2%Fibonacci retracement. A push below that opens the door for a challenge of the 50% Fib at 168.71.

We sold GBPJPY at 172.26 and took profit on half of the positionat 171.27. The series of lower highs and lower lows – the definition of a down trend – initiated from the May 2 peak remains in place. As such, we will keep the remainder of the trade in play with a stop-loss set to the breakeven level (172.26).



--- Written by Ilya Spivak, Currency Strategist for DailyFX.com


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Talking Points:

• GBP/USD Technical Strategy: Flat
• Support:1.6808 (trend line), 1.6711 (38.2% Fib ret.)
• Resistance:1.6920 (May 21 high), 1.6996 (May 6 high)

The British Pound edged downward anew against the US Dollar, with prices back to re-test rising trend support established from early February (now at the 1.6808 figure). A daily close below this barrier initially targets the 38.2% Fibonacci retracement at 1.6711. Resistance comes in at 1.6920, the May 21 high, with a break above that opening the door for a challenge of the May 6 top at 1.6996.

Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, taking up the long side seems premature in the absence of a defined bullish reversal signal. We will remain on the sidelines for the time being.




--- Written by Ilya Spivak, Currency Strategist for DailyFX.com


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Talking Points:

• GBP/JPY Technical Strategy: Flat
• Support: 171.95 (61.8% Fib ret.), 171.49 (50% Fib ret.)
• Resistance: 172.28 (trend line), 172.52 (76.4% Fib ret.), 17.45 (May 2 high)

The British Pound may be exhausting its advance against the Japanese Yen as prices test trend line resistance dating back to early March (172.28). A break above this barrier on a daily closing basis exposes the 76.4% Fibonacci expansion at 172.52, followed by the May 2 high at 173.45. Near-term support is at 171.95, the 61.8% Fib, with a move below that initially targeting the 50% level at 171.49.

The available trading range is too narrow to justify a trade on the long or the short side from a risk/reward perspective. We will remain on the sidelines and wait for a more attractive opportunity to present itself.




--- Written by Ilya Spivak, Currency Strategist for DailyFX.com


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Talking Points:

• GBP/JPY Technical Strategy: Flat
• Support: 172.00 (61.8% Fib exp.), 171.53 (50% Fib exp.)
• Resistance: 172.21 (trend line), 172.59 (76.4% Fib exp.)

The British Pound managed to claw its way back above the 172.00 level against the Japanese Yen on the back of supportive rhetoric from BOE Governor Carney. Prices are testing resistance at 172.21 marked by a falling trend line set from January. A daily close above this barrier initially exposes the 76.4% Fibonacci expansion at 172.59. Alternatively, a reversal back below the 61.8% Fib at 172.00 clears the way for a test of the 50% expansion at 171.53.
Risk/reward considerations argue against entering long with prices sitting squarely at resistance. On the other hand, taking up the short side is premature absent a defined bearish reversal signal. We will remain flat for now.



--- Written by Ilya Spivak, Currency Strategist for DailyFX.com


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Talking Points

• GBP/USD Technical Strategy: Longs Preferred
• Morning Starsuggests potential for further gains
• Bearish patterns remain absent on the daily

GBP/USD’s promises a further push higher following a Morning Star formation on the daily. With current levels not witnessed since 2008, definitive areas of resistance are not easily identifiable. This suggests traders may defer to psychologically-significant handles to look at taking profits and puts 1.7200 on the radar.

GBP/USD: Morning Star Heralded Upside Breakout


Drilling down to the four hour chart; a Dark Cloud Cover pattern had hinted at a reversal in intraday trade, yet failed to find follow-through. This suggests the bulls remain in control and creates doubt over a potential pullback.

GBP/USD: Dark Cloud Cover Finds Little Follow-Through

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By David de Ferranti, Market Analyst, DailyFX

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Talking Points

• GBP/USD Technical Strategy: Sidelines Preferred
• Narrow range between 1.7100 and 1.1710 remains in play
• Dojis denote deliberation as consolidation continues

GBP/USD continues to keep traders in suspense as the pair wavers within a narrow 70 pip range between 1.7100 and 1.7170. A lack of definitive bearish reversal candlestick signals casts doubt on a correction below support.

GBP/USD: Range Remains In Force As Doji Signal Trader Indecision



Drilling down to the four hour chart; several Dojis near 1.7170 suggest hesitation from traders near the key technical level. A test of the range-bottom at 1.7100 may afford new long entries as the recent range remains intact.

GBP/USD: Doji Denotes Hesitation Near Key Resistance



By David de Ferranti, Currency Analyst, DailyFX

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Talking Points:

• GBP/JPY Technical Strategy: Flat
• Support: 173.53, 173.13, 172.44
• Resistance: 173.98, 174.50, 175.35

The British Pound moved lower against the Japanese Yen as expected after producing a bearish Evening Star candlestick pattern. Prices are testing support at a rising trend line set from late May (173.53), with a daily close below that exposing the 38.2% Fibonacci retracement at 173.13. Alternatively, a reversal above the 23.6% Fib at 173.98 opens the door for a move to the 14.6% retracement at 174.50.

Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal argues against taking up the long side. We will remain flat for now.



--- Written by Ilya Spivak, Currency Strategist for DailyFX.com


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Talking Points

• GBP/USD Technical Strategy: Pending Long
• Bullish reversal pattern forming on the daily chart
• Bearish formations absent in intraday trade

GBP/USD’s recovery is set to yield a Bullish Engulfing pattern on the daily chart if the current candle manages to close near present levels. The key reversal pattern would suggest a run on the recent highs at 1.7170 and be the first step towards an upside breakout.

GBP/USD: Bullish Engulfing Pattern Forming On Daily




Drilling down to the four hour chart; several Doji formations near 1.7060 denoted hesitation from traders to push past the key technical level. With bearish patterns absent in intraday trade at this stage a pullback for the Pound looks doubtful.

GBP/USD: Bearish Patterns Absent In Intraday Trade



By David de Ferranti, Currency Analyst, DailyFX

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