GBP/USD has been on the back foot as the US dollar reasserted itself and amid Boris Johnson’s election to lead the Conservative Party and the country. As Johnson enters the highest office, the pound’s technical prospects are uninspiring.
The Technical Confluences Indicator shows that GBP/USD is currently struggling around 1.2434 which is the convergence of the Bollinger Band 15min-Lower, the Fibonacci 23.6% one-week, the Fibonacci 23.6% one-day, and the Simple Moving Average 5-15m.
Once it picks a direction, it will find that resistance is more significant than support. A dense cluster of lines awaits cable at 1.2479 where we find the Pivot Point one-day Resistance 1, the previous yearly low, and the SMA 5-1d.
On the downside, weaker support awaits at 1.2382 which is the confluence of the BB one-day Lower, the PP 1d-S2, the previous weekly low, and the PP 1m-S2.
Below, even softer support awaits at 1.2337 where we find the Fibonacci 161.8% one-month meeting the PP 1d-S3.
In the unlikely case that the pound surges, high resistance awaits at 1.2544which is the meeting point of the PP 1m-S1, the PP 1d-R3, and the BB 1d-Middle.
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.
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