GBP/USD will need to break hard resistance for the next rally — Confluence Detector
The GBP/USD continues holding the high ground on the optimism related to Brexit and amid top-tier UK data. What's next?
The Technical Confluences Indicator shows that the GBP/USD is battling a dense congestion of resistance lines around 1.3150 where we see the Simple Moving Average 100-15m, the SMA 5-1h, the Bolinger Band 15m-Middle, the BB 1h-Middle, the SMA 50-15m, the SMA 10-15m, the SMA 10-1h, the SMA 10-4h, the Fibonacci 38.2% one-day, the Fibonacci 61.8% one-day, and quite a few other lines.
Moving up and getting out of the dense area will send cable to tough resistance at 1.3180 where we see the convergence of the Pivot Point one-month Resistance 1, the Pivot Point one-day Resistance 1, the Pivot Point one-week Resistance 1, the Bolinger Band 1h-Upper, and the SM 100-one-day.
If cable overcomes this line, the door is open to running much higher, with the first noteworthy upside target at 1.3289 where we see the Pivot Point one-week Resistance 2.
Looking down, support awaits at 1.3095 where we see the Pivot Point one-day Support 2 and the Fibonacci 23.6% one-week.
It is followed by the round number of 1.3000 which is the meeting point of the SMA 100-4h, the SM 50-one-day and the Fibonacci 61.8% one-week.
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.
