The GBP/USD is on the back foot on Inflation day in the UK. Where will it go from here?
The Technical Confluences Indicator shows that it will be easier for the pair to fall rather than rise. The pair faces some support around 1.3370 which is the convergence of the Fibonacci 161.8% one-day and the Pivot Point one-day Support 2.
However, really strong support awaits only at 1.3285. This is the meeting point of potent lines: the Bolinger Band one-day lower and the Pivot Point one-month Support 2,
On the topside, cable faces a cluster of resistance liens at 1.3446: the Fibonacci 61.8% one-day, the 4h High, the Bolinger Band one-hour Middle, the Simple Moving Average 100-15m, the SM 10-4h, and the SMA 5-4h. Further strong resistance is at 1.3494 which is the congestion of the Fibonacci 23.6% one-week, the one-day high, the SMA200-1h, the SMA 50-4h, the SMA 10-one day and more.
All in all, the GBP/USD has few and not-so-significant support levels to the downside while the way up is full of resistance levels.
The path of least resistance is down.
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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