Dukascopy Bank Team
Dukascopy Bank SA
GBP/CAD 4H Chart: Channel Down
Comment: Though a channel down on the hourly chart seized to exist after the pair encountered some of the early December highs at 1.7780/60, the bias towards GBP/CAD is nonetheless negative. The indicators are currently mixed, but intactness of a longer-term bearish pattern has been recently confirmed by the presence of a strong resistance area at 1.8020 (down-trend, 200-period SMA). Consequently, we should soon see a re-test of the demand zone around 1.78, where the monthly S1 coincides with the Jan 8 low. If the Sterling does not stop here, the sell-off will be likely to extend further in the direction of the lower boundary of the channel.
GBP/JPY 4H Chart: Channel Down
Comment: GBP/JPY proved to be unable to pass through a psychologically important mark at 190 during the first days of December, and since then the pair has been trending downwards. However, the near-tern outlook for the Pound is bullish—at the moment the currency is changing hand right next to the lower down-trend line forming the pattern, suggesting there is likely to emerge an upward correction. The first resistance the rally is going to meet is a combination of the weekly PP and Jan 8 high at 181, but GBP/JPY is expected to rise up to the resistance trend-line at 186 before giving in to the bearish pressure.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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