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GBP/USD: Overbought Medium-Term

Published 04/22/2014, 02:25 AM
Updated 07/09/2023, 06:32 AM

Cable failed at 1.6845, hitting 1.6843. Medium term charts look to be overbought and this could well come lower to the 1.6720/00 support in a few days time. From her we would look to cover all short positions, then to re-sell on a bounce or a break below 1.6700.

A loss of this support will keep the pressure to the downside, leaving 1.6662 as the immediate short term objective. If we break below here we will look for 1.6625.

Obviously this all depends on the market being able to stay below 1.6845. We are now seeing divergence on the indicators vs the price. This usually is a good indication of a reversal of trend, so if we do break 1.6845, I believe the topside will be limited.

1.6880/1.6900 would at this moment look to be the top and any rally to here will encourage sellers back into the market at which point they will be frantically looking to hold below this 1.6900 resistance given these overbought stochastics.

GBP/USD Technicals

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