GBP/USD may extend its falls as May struggles for political suvival — Confluence Detector
GBP/USD kicked off the new week with a gap lower on reports that many in UK PM May's Conservative Party want her out as she failed to secure meaningful concessions ahead of the meaningful vote on Tuesday. What's next for the pound? The technical picture looks promising for the bears.
The Technical Confluences Indicator shows that cable is capped at 1.2997 where we see the convergence of the Fibonacci 61.8% one-month, the previous day's low, the Simple Moving Average 200-one-day, and the Bollinger Band 15min-Upper.
Further up, the next meaningful cap is at around 1.3058 where the Fibonacci 23.6% one-week, the SMA 200-4h, and the BB one-day Middle all meet.
Looking down, some support awaits at 1.2968 which is the confluence of the BB 4h-Lower, the Pivot Point one-day S1, and the BB 15min-Lower.
Significant support awaits only at 1.2914 where the PP one-month S1 meets the PP one-day S2.
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.
