GBPUSD

[yeahbah]

i'm new to this instrument and only understand it a bit.. Kuya yeahbah help naman po..

The price bounced off 38.2% means a bull run right?

what happens next? does it, theoretically, come down and test it again and bounce back to 100%?

Yes, it bounced off 38.2% -- That means a possible continuation of the up trend but of course it must break that resistance line. Like beast_master, I would wait for a healthy pullback before going in.

As for the where it would find support, it might pullback to 1.6121 or somewhere near that level (see my previous chart).

Patience

[beast_master]

Repost:

Here's my take now on the GBPUSD:

I used to believe that the move of the cable from 1.57 the previous days was a long term rally. Now I think I am wrong and I seriously doubt that it is a genuine reversal . Here's why:






You see after more than 600 pips of gain, there was no major profit taking happening. Now that the price approaches a major resistance zone at 1.6450-1.65, it looks like they are simply driving the price up to be able to have a very good price to short sell. When short selling and profit taking combines the correction will be deep or it could even be a complete reversal. I think what is keeping this pair up is the earnings season which is also keeping the DJIA up.

So my approach now would be to make long positions cautiously by going light. No heavy positions for the meantime. Then wait for signs of weakening. I am not surprised if it can even break the trendline but I won't buy it. Instead I will be looking for opportunities to sell.

[yeahbah]

Mukhang mag-sasalpukan ang mga bulls and bears sa pair na ito

Even I won't (or maybe just a tad) buy immediately if it breaks that resistance line unless a healthy pullback occurs. I won't sell short either because my bias is to buy GBP.

Possible buying price that I'm looking at are:

* MA(800) – 1.62
* Near 38.2% - 1.6120 (Breakout point - Loss stress trade)
* Fib Potential Reversal Zone - (61.8% – 78.6%) – 1.5857 / 1.5973

For me as long as the 38.2% fib level (1.57) is not broken, I'll be on the bull side

gbpusd.gif (31.28 KiB) Viewed 189 times

[hunter]

From what I've gathered, the GBP strength came from the covering shorts of hedge funds and mutual funds. They are closing position simply because they, too, have to reports their earnings. Also, economic numbers are coming better than expected, and king are saying good things about their policies.

I don't see any correlation between GU trend and DJIA, unlike AU, NU, UCAD, and EU, somehow, they are near to 1 (correlation -1 <---> 1).

I guess, the head and shoulder won't materialized anymore as to what the theory dictates it to do.

[beast_master]

GBPUSD is not correlated with DJIA like the way the buying and selling of stocks would mean buying and selling of the cable at the same time. Their correlation comes from risk appetite/aversion. When investors invest in the stock market aggresively it means the risk appetite is in the market therefore other instruments like forex and medium yield high risk curencies like the GBP is being bought. Just because risk appetite is healthy. Therefore when investors get out of the stock market because of risk aversion, even the cable and other low yielding currencies gets dumped and investors prefer the fundamentally sound currencies like the AUD. Hope this helps.

[hunter]

Thanks beast master.. : that clarifies a bit..

what happens now since GU has breakout from the diagonal resistance? test the resistance and turn it into support? which time frame should i look to confirm that? the daily or 4h chart?

thanks again! happy to have more insights in FX room.

[hunter]

I'm looking to short this pair @ 1.6510-1.6500 sl @ 1.6600 tp @ 1.6300..

what do you guys think?

And Goldman Sachs is forecasting the price to be around 1.8000 by year end..

[yeahbah]

kampi ako kay mr. goldman sach

Your short entry looks ok. It's at 78.6% fib.

gbpusd.gif (31.99 KiB) Viewed 178 times

[hunter]

kampi ako kay mr. goldman sach

Your short entry looks ok. It's at 78.6% fib.

then buy again @ around 1.6210-50, pus next stop, 1.8000!

[yeahbah]

adik ka