(MENAFN- DailyFX) at risk ahead of EU/UK Brexit talks price constructive while above monthly open Check out our 3Q projections in our Join Michael for Live Weekly Strategy Webinars on The British Pound continues to trade within the weekly opening-range heading into the . Here are the updated targets and invalidation levels that matter on the GBP/USD charts this week. for an in-depth breakdown of this setup and more.
GBP/USD Daily Price Chart Technical Outlook: GBP/USD has been trading within the confines of this descending formation extending off the yearly highs we highlighted the threat of a larger as price was carving out an outside-day reversal off the 75% slope line. Note that daily RSI failed at the 60-threshold and further highlights the near-term risk for steeper losses here.
That said, the broader outlook remains weighted to the topside while above the August trendline with initial daily support eyed at the 100-day moving average (currently ~1.31) backed by the October open at 1.3031- we're on the lookout for downside exhaustion off one of these levels. A topside breach of the monthly range highs looks to challenge more significant resistance at the confluence of the December low, the September highs and the 38.2% at 1.3302/17 and the upper parallel around ~1.3360s.
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GBP/USD 240min Price Chart Notes: A closer look at near-term price action shows Sterling holding a within a clean just below the 100% extension of the monthly advance at 1.3239. A break below 1.3090 targets confluence support at 1.3031/50- an area of interest for possible long-entries IF reached. Weakness beyond this region would invalidate the monthly advance with such a scenario risking a decline back towards 1.2877-1.2905.
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Bottom line: Sterling has carved out a clear weekly opening-range and we're looking for the break for offer further guidance. From a trading standpoint, I'll favor fading weakness while above monthly open support with a breach above 1.3239 needed to fuel the next leg higher in price. Keep in mind there is considerable event risk on the horizon with EU-UK Brexit summit likely to dominate the headlines over the next 48 hours tread lightly.
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GBP/USD Trader Sentiment A summary of shows traders are net-long GBP/USD - the ratio stands at +1.28 (51.3% of traders are long) weak bearishreading Traders have remained net-long since September 20th; price has moved 0.2% higher since then Long positions are1.0% lower than yesterday and 16.2% lower from last week Short positions are 4.5% higher than yesterday and 22.3% higher from last week We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBP / USD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week and the recent changes in sentiment warn that the current GBP/USD price trend may soon reverse higher despite the fact traders remain net-long. See how shifts in GBP/USD retail positioning are impacting trend-
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