Price Action Opportunity in British Pound

Price Action Opportunity in British Pound

British Pound

The situation with the British Pound looks interesting. The market is making higher lows and with the coming bullish seasonal period (starting this week) looking for longs is justified.  

British Pound analysis 07/13/2020-07/17/2020 

Applying the techniques from The Talking Chart book, we see that the BP was up for a pause after the 0N we saw on Wednesday. That pause started when Thursday's bar closed almost at the same level as a day before. The shape of 1xN suggested that the next day should go down.  

Friday, however, presented us with something very interesting, EQ bar

What is the meaning of this bar and how we can use it in the current situation:

  • according to the test from the book an EQ bar will be followed, in 80% of the cases, by a bar in the opposite direction. In our case, the next trading day is Monday which could mean an inside day down close.
  • both high and low of the EQ bar are equally strong levels but I'll give more weight to the eventual break above the high.   

Breaking Friday's or even better Thursday's high, on Monday should lead to an up move and eventual test of the unfilled gap on the previous top (06/10/2020)

Other Instruments

There is not much else to mention as upcoming opportunities for the coming week. 

EURO looks bullish also, but the British Pound is stronger.   

Silver presented us with a small-range, inside, 1xN bar on Friday. That is a good setup for a short-term play. There is a good accumulation and longs should be proffered. 

I am still bullish on S&P500 and will be looking to take longs there.

Now, let's find your missing piece!

Vassil Banov,
Founder of Piece of Trading

Trades mentioned here are either taken or will be taken by the author if the right conditions appear. They are NOT recommendations nor any of this constitute investment advice. Please read the Risk Disclaimer
Seasonal indicators courtesy of Larry Williams, Charts made with TradeStation®.

TAGS: S&P500, British Pound, SPY, Stock Market, EURO, EURUSD, Price Action Trading, Silver

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