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GBP/USD is leaning lower and gets close to critical support

A new week, month, and quarter begins with the GBP/USD resuming its losses. What levels should we watch out for?

The  Technical Confluences Indicator  shows that the pair is nearing a strong support line at  1.3152. This is the convergence of the potent Fibonacci 23.6% one-month, the Simple Moving Average 10-4h, the Bolinger Band one-hour Lower (Stdv. 2.2), the Fibonacci 38.2% one-week, and the BB 1h-Middle.

If the pair loses that critical cushion, the next level to watch is  1.3057which is the confluence of the one-month low and the one-week low as well as the Bolinger Band one-hour Lower. Before hitting 1.3000, there is one more notable support area at around 1.3020 which is the meeting point of the Pivot Points one-day Support 2 and the one-month Support 1.

On the topside, cable will find it hard to recover.  1.3215  is where the Fibonacci 38.2 one-month, the 4h-high, the one-day high, and the SMA 50=4h converge. There are additional lines of resistance at  1.3200defending the region.

Further up,  1.3248  is notable for the Bollinger  Band one-hour Upper. Much higher,  1.3317  is the confluence level of the Pivot Point one-day Resistance 2, the Fibonacci 61.8% one-month, and the SMA 200-4h.

The pair is trading within a range of many technical levels, but those on the top are stronger than those on the bottom.

This is how it looks on the tool:

GBP USD Technical confluence July 2 2018

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.

Learn more about Technical Confluence

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.