I haven’t written a post on the blog “Trend” for over a month. I want to renew writing my posts. I won’t do it every day, but hope to renew the blog a few times each week.
Today I will write a short post on my expectations about gbp/usd pair. If you look at daily chart, you will see that the security is at a very important support level of 1.5270-1.5300. The last time the pair visited the level was on the 6th of October 2011. It isn’t a very long period of time, but I still expect the area to hold and pound to strengthen against the greenback. This prediction of mine is based on general technical market tendencies. We more often see a reversal at important support and resistance levels rather than breakouts.
Although RSI indicator is not too much oversold yet, it does not mean the 30 level on indicator has to be reached by all means. No, my intuition says we have to follow price action in this situation on not start selling a breakout. Let the pair play a little in a range and when the breakout time comes we will have sat in a tight range for quite a long period of time. At least I hope so. And then, down we will go.
Hope this short market trend analysis was useful.
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Disclaimer
Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.