DailyFX analysts maintained a bearish bias against the British pound throughout February and were rewarded as the currency saw across the board weakness. Sterling sharply fell over 1,200 pips against both the dollar and Yen on the back of broader risk aversion, weak growth and a dovish BoE.
Pair has been moving in a 300 pips range since past February 17th, almost a month consolidating between the 50% retracement (1.3800) and the 61.8% (1.3485) of past year March/November bullish rally. Taking a look at this weekly chart, you will find out how strong indecision is: we have been opening and closing the past 5 weeks almost at the same level: five dojis in a row. I also see kindo fo a rounded floor forming both in charts and indicators, that are saturing at the bottom, also drawing a probable floor that should end up in a reversal, if, and only if, pair manages to close a weekly candle above the 1.3800 mentioned area.
Maybe this end of week US data can take as out of this range.. let’s see! Short term speaking, pair has same resistances levels as it has almost all the week: 1.3685, 1.3710 and above 1.3750, while supports form current price come at 1.3640, 1.3610 area and the strong 1.3580.
Yesterday's follow-through higher was almost as expected but stopping slightly short of the 90.92 target. We still have to keep this level in mind but I feel we are running out of time to see the follow-through to 92.14. At the most I would not want to see any further than 90.10 in this correction else an alternative and more bearish structure will be implied. Therefore, watch this support and as long as it holds a move back above 90.60 & 90.93 could even trigger a rally as high as the 92.14 target (allow a little more) by the end of today.
Please view the complete analysis in the attached PDF file.
For a full description of how to use the analysis please see the Analysis page of my website. The prior day's set ups for the support & resistance levels highlighted in the report are now available on the Daily Forecast page of my web site. (+55 pips)
Losses were pretty solid and stalled just below the 134.00 support. I suspect this is probably enough for now and we could begin to see some rather messy consolidation but with a basically bullish undertone. I don't think we'll get a break below yesterday's 133.93 low and more probably see a bounce from between 133.93-134.50 which can then slowly move towards 135.55-65 and possibly as high as 135.93-20.
Please view the complete analysis in the attached PDF file.
For a full description of how to use the analysis please see the Analysis page of my website. The prior day's set ups for the support & resistance levels highlighted in the report are now available on the Daily Forecast page of my web site. (+100 pips)
