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Bears' thoughts aloud

30 August 2016, GBP/USD

Daily chart: the pair continues to stay within the horizontal band inside Bollinger envelopes (1.2872 - 1.3330). So, finalization of 1.2872 is expected (though we also see that ADX is going through correction and weak, which could mean extended flat)

Н4: a better shaped support 1.3039 (the bottom Bollinger band). ADX started to attack, but is far from trend, so a rebound is possible. If bears force this support, a deeper drop will start in the direction of 1.2872.

Н1: at this local level, there is also a flat both shown by indicators and price chart. Support is even better shaped (1.3060) and there is a high probability that today sellers will not break this price.

The main scenario - decline to 1.3060 and then rebound to 1.3090

The alternative scenario - decline to 1.3039 and on a successful attack a breakdown below will be enabled, the movement will start to 1.2872 ( extraday)

Trading solutions: purchase is not considered at all, whereas Sell entries are not clear (overall goal is known - 1.2872, but in its way there are two strong support points - 1.3060 and 1.3039). Therefore, we sell only after a possible upward correction to 1.3090

Aleksey Panasenko
FreshForex Analyst
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