GBP/USD has strong support only below $1.4000 — Confluence Detector
|The GBP/USD is having a terrible week, being hit from all sides, and this may not be the end. The Technical Confluences Indicator shows that round level of $1.4000 does not consist of any particular line of support, and the pair falls further to find a convergence of technical lines to cushion the fall.
$1.3987 is a significant level where the Pivot Point one-week S1meets other levels. However, only around $1.3960 does the pair face a more serious congestion: the Pivot Point one-day S2, the Bolinger Band one-day Lower (Stdv. 2.2), and the Fibonacci 161.8% one-week.
Below, $1.3915 we find the one-month low and the Fibonacci 61.8% one-month congestion. These are both potent technical support lines.
Resistance awaits at $1.4050, where the Fibonacci 38.2% one-month, the one-hour high, the BB 15-Middle, and the SMA5-1hv all converge. $1.4115 is next in line in case of a broad recovery. It is the confluence level of the BB 1h-Upper, the Fibo 23.6% one-day, and the Pivot Point one-week S1.
Here is how it looks:
Confluence Detector
The Confluence Detector finds interesting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. This means that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.