I’m currently holding a sell position on GBP/USD at 1.32480, and despite price climbing to 1.32942, I see several technical and fundamental factors that support my trade idea.
Fundamental Perspective
Looking ahead, this week presents major economic events that could drive volatility in GBP/USD.
UK PMI (April 23): Manufacturing PMI is expected to drop to 44.1, while Services PMI may soften to 51.0—both indicators suggest economic slowdown, potentially putting downward pressure on GBP.
US Durable Goods (April 24): Forecasts show mixed numbers—headline durable goods is projected at +1.8%, but ex-transportation and ex-defense figures are negative, meaning uncertainty surrounding USD demand.
UK Retail Sales (April 25): The monthly figure is expected at -0.3%, signaling weaker consumer spending. This aligns with my sell bias, as deteriorating UK economic conditions could contribute to pound weakness.
If the UK data disappoints while US figures remain mixed or slightly stronger, GBP/USD could face renewed selling pressure, validating my position.
Technical Analysis - Historical & Indicator Confirmation
Looking at the daily chart, there’s strong alignment between price action and indicator readings that suggest a potential reversal:
Resistance Holding at 1.330–1.331:
The Stochastic at 74.88 suggests GBP/USD is nearing overbought conditions.
The Williams %R at -22.24 reinforces the idea that price is pushing into exhaustion territory.
Support Structure (Where Downside Pressure Could Build):
Immediate Support at 1.326–1.327: Previous lows from April 20 confirm this zone as a critical level for sellers.
Secondary Support at 1.321: Multiple recent price reactions suggest this area could serve as a strong downside target.
Deeper Support at 1.316–1.318: If bearish momentum strengthens, this area represents a key swing low.
Additionally, while price is pushing higher in the short term, it’s trading well above long-term daily EMAs, suggesting the rally is a temporary overextension rather than a sustained breakout. If GBP/USD fails to break above 1.330–1.331, momentum could shift in favor of my sell trade.
Trade Management & Outlook
Despite the recent push higher, I remain confident in my sell position as long as GBP/USD does not break and hold above 1.330–1.331. If price starts rejecting this level, the next downside target could be 1.326, followed by 1.321, where I’d consider taking partial profits.
With fundamental catalysts ahead, volatility will likely increase. If bullish momentum persists beyond 1.331, I may need to re-evaluate my position, but until that happens, my trade setup remains valid.
Final Thoughts
My sell at 1.32480 is built on strong reasoning—key fundamental risks, extended technical levels, and a solid structure of resistance all favor a potential reversal. If sellers step in soon, I’ll have the opportunity to secure profits on a well-planned move. Now, it’s a waiting game to see how price reacts to resistance and upcoming data.
Fundamental Perspective
Looking ahead, this week presents major economic events that could drive volatility in GBP/USD.
UK PMI (April 23): Manufacturing PMI is expected to drop to 44.1, while Services PMI may soften to 51.0—both indicators suggest economic slowdown, potentially putting downward pressure on GBP.
US Durable Goods (April 24): Forecasts show mixed numbers—headline durable goods is projected at +1.8%, but ex-transportation and ex-defense figures are negative, meaning uncertainty surrounding USD demand.
UK Retail Sales (April 25): The monthly figure is expected at -0.3%, signaling weaker consumer spending. This aligns with my sell bias, as deteriorating UK economic conditions could contribute to pound weakness.
If the UK data disappoints while US figures remain mixed or slightly stronger, GBP/USD could face renewed selling pressure, validating my position.
Technical Analysis - Historical & Indicator Confirmation
Looking at the daily chart, there’s strong alignment between price action and indicator readings that suggest a potential reversal:
Resistance Holding at 1.330–1.331:
The Stochastic at 74.88 suggests GBP/USD is nearing overbought conditions.
The Williams %R at -22.24 reinforces the idea that price is pushing into exhaustion territory.
Support Structure (Where Downside Pressure Could Build):
Immediate Support at 1.326–1.327: Previous lows from April 20 confirm this zone as a critical level for sellers.
Secondary Support at 1.321: Multiple recent price reactions suggest this area could serve as a strong downside target.
Deeper Support at 1.316–1.318: If bearish momentum strengthens, this area represents a key swing low.
Additionally, while price is pushing higher in the short term, it’s trading well above long-term daily EMAs, suggesting the rally is a temporary overextension rather than a sustained breakout. If GBP/USD fails to break above 1.330–1.331, momentum could shift in favor of my sell trade.
Trade Management & Outlook
Despite the recent push higher, I remain confident in my sell position as long as GBP/USD does not break and hold above 1.330–1.331. If price starts rejecting this level, the next downside target could be 1.326, followed by 1.321, where I’d consider taking partial profits.
With fundamental catalysts ahead, volatility will likely increase. If bullish momentum persists beyond 1.331, I may need to re-evaluate my position, but until that happens, my trade setup remains valid.
Final Thoughts
My sell at 1.32480 is built on strong reasoning—key fundamental risks, extended technical levels, and a solid structure of resistance all favor a potential reversal. If sellers step in soon, I’ll have the opportunity to secure profits on a well-planned move. Now, it’s a waiting game to see how price reacts to resistance and upcoming data.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.