- The formation of a symmetrical triangle indicates a consolidation ahead.
- Overlapping short-to-medium-term EMAs signals a volatility contraction.
- Quiet market mood is keeping the risk-perceived assets in a rangebound structure.
The GBP/USD pair turned sideways in the early Tokyo session after attempting a rebound below the critical support of 1.1800. The Cable is looking to extend its recovery above 1.1820 as risk-perceived currencies are gaining some traction in a quiet market mood.
Meanwhile, the US dollar index (DXY) is hovering around 107.80 after a bullish Monday. Apart from that, the 10-year US Treasury yields also rebounded to near 3.83% despite bleak chances of continuation of the 75 basis points (bps) rate hike structure by the Federal Reserve (Fed).
A formation of a Symmetrical Triangle on an hourly scale is indicating a volatility contraction. The upward-sloping trendline of the chart pattern is placed from November 14 low at 1.1710 while the downward-sloping trendline is plotted from November 15 high at 1.2029. A breakout of the same will result in wider ticks and heavy volume.
The 20-and 50-period Exponential Moving Averages (EMAs) are overlapping with each other, which signals a consolidation ahead.
Meanwhile, the Relative Strength Index (RSI) (14) has shifted into 40.00-60.00, which indicates the unavailability of a fresh trigger for decisive action ahead.
Going forward, a break above Friday’s high at 1.1950 will drive Cable towards November 15 high at 1.2029, followed by the round-level resistance at 1.2100.
On the flip side, a drop below Monday’s low at 1.1780 will drag the asset toward November 14 low at 1.1710. A slippage below November 14 low will expose the asset to the horizontal support plotted from October 27 high at 1.1646.
GBP/USD hourly chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD rises toward 1.0800 as USD weakens
EUR/USD has gained traction and advanced toward 1.0800 in the early American session on Monday. The positive opening witnessed in Wall Street makes it difficult for the US Dollar to find demand and helps the pair continue to push higher.
GBP/USD closes in on 1.2300 as mood improves
GBP/USD has preserved its bullish momentum and advanced to the 1.2300 area in the second half of the day on Monday. The risk positive market atmosphere makes it difficult for the US Dollar to stay resilient against its rivals and fuels the pair's daily rally. Eyes on BOE Governor Bailey's speech.
Gold: XAU/USD pared losses and consolidates around $1,950.00 Premium
Spot gold trades in the $1,950 price zone, sharply down on Monday as investors move away from safe-haven assets. The sentiment is positive at the start of the week amid easing concerns related to a global banking crisis.
MicroStrategy buys $150 million worth of Bitcoin as institutional interest soars to eight-month high
Bitcoin has been noting increasing institutional interest for the last few days as whale movement on the network grew.
US Consumer Confidence Preview: No good news for Americans Premium
The United States will publish the March Conference Board Consumer Confidence index, and market players anticipate it has contracted to 101 from 102.9 in February.