Dukascopy Bank Team
Dukascopy Bank SA
GBP/USD 4H Chart: Broadening Falling Wedge
Comment: The overall outlook for the GBP/USD pair is bullish, even though technical studies in the long-term are unable to confirm this. The pair formed a falling wedge pattern since the beginning of 2016, which mostly implies a breakout to the upside. However, because the wedge is broadening, there is still room for a decline, just as technical indicators suggest. The first target is the March 16 low at 1.4051, which is somewhat reinforced by the monthly S1. A breach of this area is likely to set the pair on a bearish path towards the monthly S2, closer to the wedge’s support line, after which a recovery towards the pattern’s resistance line is to take place. The Sterling is somewhat overbought, as 67% of all open positions are long.
CAD/CHF 1H Chart: Channel Down
Comment: The Canadian Dollar has been declining against the Swiss Franc since the middle of the previous month within the borders of the descending channel. Furthermore, ever since the channel’s upper border was confirmed on the 31st of March, the CAD/CHF has been rather rapidly moving towards the lower border, putting it to the test last Friday. Impetus received there was insufficient to jump back up towards 0.7440, namely the channel’s resistance line; therefore, we expect another retest of the lower boundary by the end of the day, unless demand at 0.7308 (the weekly S1) triggers a buying spree. Meanwhile, technical studies are in favour of the bearish outcome, while 74% of all open positions are short.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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