The last time we checked up on GBP/USD was on January 17. And if y’all can still recall, the pair was at 1.2400 back then. And while we were expecting the pair to continue moving higher, we were also expecting a pullback also the way back to 1.2200. Unfortunately, the pair only went down to 1.2300 and then milled about for a while before rapidly climbing back up again. Some of y’all may therefore have missed the ride. But for those of ya who were able to jump in at 1.2300 or 1.2400 and then bail out close to 1.2700, then congratulations on your 300-400 pips in the bag. That’s right! We got bank, dawg! And that’s in addition to the 300+ pips we got from our original setup from January 16. Aww, yea!
Anyhow, if we take the most recent price action into consideration, we can see that a fresh ascending channel appears to have formed. And presently, the pair is making its way to the channel’s support area after getting rejected at 1.2700. Y’all therefore better start lookin’ for opportunities to go long. As y’all can also see on that there chart, the channel’s support area lines up rather well with the area of interest at the 1.2500 major psychological level. Moreover, stochastic be indicating oversold conditions and all that already. Overall, lots of technical arguments that may attract bulls to jump in.
Bearish momentum looks strong, though. Y’all may therefore wanna wait until support actually holds. But if you’re just so gangsta that ya plan to go long right at 1.2500, then just be ready to bail (or even switch bias) if the pair stages a downside channel breakout while smashing past 1.2400, since that means that them bears will likely be gunning for 1.2000. Although they do have to go through 1.2300 and 1.2200 first.
That there ascending channel on NZD/USD’s 1-hour chart ain’t actually fresh. You see, we first identified that way back on January 20. And back then, we was lookin’ to go long on the pair because it was close to the channel’s support area just above 0.7120. Well, the pair moved over 200 pips since then, which is real sweet, so give yo self a pat on the back if ya were able to find a trade back then.
And since the channel is still intact, why not play it again? If life gives ya lemons, go make some lemonade. Know what I’m sayin? The pair has already left the channel’s support area, though, so more conservative traders may wanna sit this one out for a while until the pair returns to test the channel’s support area, since stochastic is already signaling overbought conditions. But for the more gangsta traders out there, just keep an eye on how the pair reacts to 0.7360 since them bears appear to be waiting there. Also, the bullish momentum has slowed, so there’s a small chance for a downside channel breakout, so y’all may wanna prepare for that as well. A downside breakout ain’t confirmed until the pair smashes past 0.7220, though, with 0.7120 being the next likely destination. In any case, just make sure to practice proper risk management, a’ight?
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