GBP/USD at shaky low support ahead of the second round of the Conservative contest — Confluence Detector
GBP/USD has been on the back foot, falling to new five-month lows as the Conservative Party holds its second round of the leadership contest. What levels should we watch?
The Technical Confluences Indicator faces fierce resistance at the former low of 1.2558 where we also see a dense cluster of lines including the previous monthly low, the Fibonacci 38.2% one-day, the Fibonacci 23.6% one-day, the Simple Moving Average 5-4h, and the Bollinger Band 1h-Middle.
Further resistance is close. At 1.2582 we find the meeting point of the Fibonacci 61.8% one-day and the previous weekly low.
Immediate support awaits 1.2535 where we see the convergence of the BB 15min-Middle, the SMA 5-15m, the previous daily low, and the SMA 10-1h.
If Sterling falls below that support, the next cushion is only at 1.2484 which is the confluence of the Pivot Point one-day Support 2 and the previous yearly low.
This is how it looks on the tool:
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. 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.
Author
Yohay Elam
FXStreet
Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.
