Sterling was looking good today, in heading up to a new 3 week high of 1.2435, before the announcement of the impending trigger of Article 50 on March 29 sent it sharply lower, to 1.2335 before finishing at 1.2350.
The session high managed to touch the descending trend resistance at the top of the channel that has dominated the action over the last couple of months and it looks as though this is going to continue to be the case over the next few sessions, at least. The dailies still look mildly positive though, and on the topside the 100 DMA lies at 1.2405, which will provide a near-term cap ahead of the session high. A break of this would trigger stops, and this could see a continuation towards 1.2485 where the next, major descending trend resistance lies, which if seen should be tough to break at the first attempt although I don’t think it is in any danger at this stage. On the downside, minor support will be seen at 1.2325/35 and then at the minor Fibo levels of the run-up from the recent 1.2108 lows. Buying dips still seems to be the plan from a technical perspective although politics could quickly change that theory, but in the meantime, look for 1.2310 as a possible buy area, with a SL placed under 1.2270, while looking for a run towards 1.2485.
|24 Hour: Prefer to buy dips||Medium Term: Neutral|
|1.2475||Descending trend resistance||1.2334||Session low|
|1.2460||(76.4% of 1.2570/1.2108)||1.2323||17 March low|
|1.2435||Descending trend resistance /Session high||1.2310||(38.2% of 1.2108/1.2435)|
|1.2405||100 DMA||1.2270||(50% of 1.2108/1.2435)|
|1.2390||Minor||1.2230||(61.8% of 1.2108/1.2435)|
Interested in GBPUSD technicals? Check out the key levels
- R3 1.2407
- R2 1.2401
- R1 1.2393
- PP 1.2387
- S1 1.2378
- S2 1.2373
- S3 1.2364
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