GBPUSD: Neutral and still pointing higher
|Cable corrected as we said yesterday that it should after looking increasingly wobbly above 1.33...Now we said it would come down to the 1.3218 area possibly 1.3180 and we did.. we hit 1.3184....Now we are in the 1.32 area and the 4 hrly charts look oversold so there is a case for a move higher today.. especially as we are at Reversal Thursday....
Now the longer term time frames are still overbought with the exception of the weeklies...which are neutral and still pointing higher...however...as I said yesterday...the force of the move lower from 1.33 to 1.3184 was quite significant...and although not a key reversal day it was certainly a reversal day.. Now as we did not break the 1.3180 area there is as I said a good chance for a correction today...
Now we know 1.3218 was a level on the way down...so we have to clear it on the way up where can we actally go back to it we clear this resistance...well the outer limit I have is 1.3275....so I think we would be quite safe to initiate shorts on a bounhce to here...stops a little bit further away at 1.3340...If you can not leave them that far away remember that if we do break 1.3340 we would be looking to reverse shorts...so therefore we would run these towards 1.35 thus wiping out the previous short loss...
I am not sure we can go higher however...still not why the daily charts look so overbought...so I am quietly confident that we will falter on a bounce...Now as I said yesterday...we fail to hold over 1.3380 1.3160/55 would be the short term objective with 1.3120 following...
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