Welcome to mid-week trading, errbody!
If you’re looking for GBP setups to trade this week then you’re in luck.
GBP/USD just bounced from a shallow Fib retracement while EUR/GBP looks ready for a countertrend move!
First up is a nice and simple short-term uptrend for Cable.GBP/USD just bounced from the 1.2200 psychological level, which was not far from last week’s highs, the 38.2% Fibonacci retracement of this week’s upswing, and the trend line and moving average support zones on the 1-hour time frame.
Think GBP/USD can make new intraweek gains in the next few days?
Momentum traders can take advantage of the current upswing and aim for the recent highs near 1.2280. If there’s enough buying pressure, you can even aim for the 1.2300 area of interest!
Don’t discount another pullback though.
Stochastic is headed for the “overbought” zone and the 1.2300 resistance could attract enough bears to drag GBP/USD back down to the trend line area.
What do you think? Will GBP/USD see deeper retracements? Or will it continue to trade all the way to new weekly highs?
If you’re looking at the lower highs and lower lows that EUR/GBP had been making since February and you got “downtrend!” then you should take a broader look at the 4-hour time frame.As you can see, EUR/GBP is not too far from a trend line support that hasn’t been broken since August 2022.
EUR bears can take advantage of Stochastic‘s overbought signal and EUR/GBP finding resistance at the descending channel and 4-hour moving averages.
The trend line support can make for a good initial target though you can also eye March’s lows near .8730 if there’s enough momentum.
If you’d rather buy EUR against GBP, then you’ll want to do it when EUR/GBP is trading closer to the trend line support. You can aim for the .8850 area of interest or .8920 previous highs depending on the bullish momentum.