GBP/USD remains under heavy pressure, downside target 1.2540 — Confluence Detector
GBP/USD is trading in the mid-1.2600s, looking for a new direction as the focus remains on the leadership contest in the Conservative Party. What's next?
The Technical Confluences Indicator shows that GBP/USD is facing substantial resistance. The first level to watch is 1.2671 where the Simple Moving Average 100-15m meets the Fibonacci 38.2% one-day.
The next noteworthy cap is quite close. At 1.2704 we see the convergence of the SMA 200-1h, the Pivot Point one-month Support 2, and the previous day's high.
Another resistance confluence awaits at 1.2738 where we see the confluence of the Bollinger Band 4h-Upper, the Fibonacci 61.8% one-week, and the Fibonacci 161.8% one-day.
Looking down, initial support is around 1.2605 where the PP 1w-S1 and the previous weekly low converge.
The downside target is 1.2540 where we see the PP one-month S3 and the BB 1d-Lower meet.
All in all, support is much weaker than resistance.
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.
