Cables is trading around its weekly and daily pivot today with a U shaped recovery from its daily price action lows i.e 1.38030 to daily high 1.38557 on shorter time frames. MACD is kind of shifting its balance more onto bullish arenas for show of a bullish reversal. As what we call ranging or range bound, can clearly define the current situation which in shape of consolidation hasnt provided any breakout for further fractal confirmation. Today we had CPI and Core CPI with positive figures which helped the pair gain some ground from its daily support but didnt manage to provide any further impulse. The converging pennant on our chart is portraying a near time breakout out of the pennant soon but before that happens there are certain scenarios which needs to be kept under radars. 

BULLISH AND BEARISH POSSIBILITIES/ CONDITIONS :

GBPUSD is benefiting from upside momentum on the four-hour chart but has failed to recapture the 50 Simple Moving Average. It remains below the 100 and 200 SMAs. Support awaits at the daily low of 1.38, followed by 1.3750 and 1.3730, which have served as support lately. Further down, 1.3670 is the next cushion. Some resistance is at 1.3840, which held cable down last week. It is followed by the stubborn 1.3905 line which is the weekly high. At the moment we are expecting more for cables to provide an upside impulse to its 50EMA i.e 1.39626 and a bearish reversal along with a closing like dark cloud cover for example will be an indication for pound to revert its move towards 1.36737 and 1.35620. The aforementioned levels can be taken as a good buying opportunity for the market will provide a bullish impulse to 50% and maybe 61.2% fibb level as a retracement. 

GBPUSD D1

Jul 14 2021