GBP/USD path of least resistance is down ahead of critical data – Confluence Detector
GBP/USD is looking for a new direction after the UK clashed with China over Huawei and ahead of all-important inflation, jobs, and retail sales figures from the UK. How is the currency pair positioned?
The Technical Confluences Indicator is showing that cable faces a wall of resistance at 1.2589, which is a dense cluster including the Bollinger Band 15min-Upper, the Pivot Point one-day Resistance 1, the BB 4h-Middle, the Simple Moving Average 4-one-day, the Fibonacci 38.2% one-week, the BB 1h-Upper, the Fibonacci 38.2% one-month, and more.
Further above, the next cap is at 1.2673, which is the convergence of the PP one-day R3 and the previous weekly high.
Support awaits at 1.2535, which is the confluence of the SMA 10-one-day and the Fibonacci 61.8% one-week.
Further down, the next cushion is at 1.2490, which is the meeting point of the BB one-day Middle and the SMA 100-4h.
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.
