As most of the American macroeconomic data released on Friday did not justify expectations, the cable ended the week in a green zone. Nevertheless, in the early hours of this trading session it started with an active plunge, slipping through the updated weekly PP , the 55- and 100-hour SMAs. An existence of two ascending channels suggests that the drop might be stopped near the 1.3545 level. In the meantime, other technical indicators point out that the two closest notable support levels are located around the 1.3540 and 1.3500 marks. Nevertheless, there is a need to take into account that majority of pending orders both in 50- and 100-pip ranges are set to sell.
The British Pound is continuing to slowly advance against the Dollar in a one-month long ascending channel. New trading session the cable started above the combination of the weekly PP, the 55- and 100-hour SMAs, which are expected to provide support for further surge.
Accordingly, the weekly goal for the pair should be an area located between the psychological 1.3600 level and het monthly R1 at 1.3615. However, it should be noticed that for the past three days the currency rate could not climb above the 1.3585 level, which might lead to a premature breakout from pattern especially in case of high volatility, such as on Friday.
In result of the previous trading session the currency rate has broken through support line of a one-month long ascending channel, thus ending the consolidation phase. Even though the pair has already crossed the 200-hour SMA and there are signs of a forming descending channel, a bunch of technical indicators suggest that an area around the psychological 1.3500 mark represents strong support level, which is likely to lead to a rebound. In that case, the cable might jump back to 1.3550.
However, without additional impulse, for instance, from some fundamental event the further surge is unlikely because of combination of the 55- and 100-hour SMAs. Nevertheless, from daily perspective it seems that deprecation of the Pound will continue at least until the rate will reach the 50% Fibonacci retracement level at 1.3485.
Check out our trading platform: