Relief flows could bring GBPUSD well above 1.3000 – Confluence Detector
|Forthcoming weakness in the US dollar lead the Sterling to a climb back above the 1.29 handle. Today it is tentatively unwinding its rally ahead of Brexit related news.
The first challenge today will be the 1.2800 handle, just below the weekly pivot point, daily S1, the 100-hour SMA, and yesterday's low, converging together. Only with this handle boldly violated it would became questionable if the recent two-week stretch will be enough to prevent a renewed attack at key support at 1.2700. In between, 1.2760 indicator cluster may come into play.
On the upside, lack of technical hot spots in our Confluence Indicator, forces us to check price charts with a wider range. Here we note an intersection of September's recovery rejection and an ascending resistance line at 1.3270 which could be a provisional upside target levels, specially is the house approves the Brexit deal causing massive relief flows.
Confluence Detector
The Confluence Detector finds exciting 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. These weightings mean 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.
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