GBP/USD faces fierce resistance on New Year's Eve— Confluence Detector
GBP/USD has had a turbulent 2019 which is now nearing its end. How will it perform on the last day of the year? The path of least resistance is to the downside.
The Technical Confluences Indicator is showing that pound/dollar is capped at 1.3130, which is a dense cluster including the Simple Moving Average 5-15m, the SMA 10-1h, the SMA 5-4h, the Fibonacci 161.8% one-month, the SMA 10-15m, and the Fibonacci 38.2% one-day.
If cable manages to break higher, the next noteworthy resistance is only at 1.3253, which is where the Pivot Point one-month Resistance 3 and the PP one-week R2 converge.
Looking down, some support awaits at 1.3068, where we see the confluence of the Bollinger Band 4h-Middle and the Fibonacci 23.6% one-week.
Further down, 1.3027 is the convergence of the PP 1m-R, the SMA 10-1d, the SMA 50-4h, the SMA 5-one-day, and the SMA 200-1h.
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.
