Chart GBP/USD Update: Turning away from strong resistance at 1.3400/05
Consolidation around strong resistance at congestion around 1.3400 and the 1.3405 Fibonacci retracement has given way to a pullback
| Level | Comment | Level | Comment | |||||
|---|---|---|---|---|---|---|---|---|
| R4 | 1.3550 | ** | 76.4% ret of Aug-Oct fall | S1 | 1.3350 | break level | ||
| R3 | 1.3500 | ** | congestion | S2 | 1.3300 | ** | congestion | |
| R2 | 1.3470 | ** | 61.8% ret of Aug-Oct fall | S3 | 1.3250 | * | congestion | |
| R1 | 1.3400/05 | ** | congestion; 50% ret | S4 | 1.3200 | ** | cong, 38.2% ret |
Asterisk denotes strength of level
08:10 BST - Consolidation around strong resistance at congestion around 1.3400 and the 1.3405 Fibonacci retracement has given way to a pullback, as overbought intraday studies unwind, with prices currently trading around 1.3370. Overbought daily stochastics are also ticking lower, highlighting room for continuation down to support at 1.3350. But the positive daily Tension Indicator and improving weekly charts should limit any initial tests in fresh consolidation. A close beneath here, however, will prompt a deeper retracement, as focus then turns to congestion around 1.3300.
Following cautious/corrective trade, fresh gains are looked for. However, a close above 1.3400/05 is needed to turn sentiment positive once again and extend mid-October gains towards the 1.3470 retracement. Just higher is congestion around 1.3500, where profit-taking/consolidation could develop.