Another strong tech convergence in cable on the upside this time
On Monday I highlighted a great support level in GBPUSD down around 1.5175/85 and it proved to be fantastic place for longs
I've also had my eye on another confluence of longer term tech above the current level. It's still a way away but the way these moves are going it probably apt to at least be aware of the levels
GBPUSD weekly chart
What I'm liking is the 50 fib of the Jul 2014 drop at 1.5877, which is joined by the 55 & 200 wma's at 1.5878 and 1.5882. If that wasn't strong enough we have the 55 mma just behind that at 1.5925. That would make a great spot to stick a stop behind but if you wanted to push the boat out with a smaller position, you could short right up to the 100 wma at 1.6029 and the Aug 2009 resistance line at 1.6043. In my view it's an even stronger convergence than the levels from the daily chart
If only it was as straight forward as that though. While it does look juicy for a short, or at least a place to think about exiting longs, as with all trades they can look good at one moment and a crock the next. We always need to judge the reasons for any particular move at the time, and it could be days or weeks before we get a test of those levels, if we do at all. Nevertheless we know that they are there and we'll keep an eye on them and have another look if we get up there
