empty
20.11.2024 03:22 AM
Overview of GBP/USD Pair on November 20: The Pound Sterling in a Downward Spiral

This image is no longer relevant

On Monday, the GBP/USD pair hit a new local low; on Tuesday, little movement or meaningful correction was observed. The inability of the pound sterling to even correct highlights a significant issue: a lack of buyers in the market. This raises the question: why are buyers absent? From our perspective, the pound remains excessively overbought and unjustifiably expensive. This imbalance will likely sustain downward pressure on the currency for some time. If the pound rallied for nearly two years without solid justification, how much further can it fall when multiple factors support the case for its decline?

It's important to note that market makers could unpredictably start buying the pound again simply because they need this currency. Contrary to popular belief, large players, including commercial banks and corporate clients, buy currencies not just for profit but for operational needs. Such actions, often involving billions, can push the exchange rate in any direction, irrespective of fundamental or macroeconomic conditions.

Our goal is to assess whether the current market movements are justified. When they are not, we acknowledge this, as the behavior of major players is difficult to predict. While trends can be forecasted for most market participants, the movements must be logical and consistent.

For two years, the market priced in the anticipated monetary policy easing by the Federal Reserve. The pound has been declining for 1.5 months, which we believe is just the beginning. The 16-year downtrend remains intact, making the recent two-year rally on the weekly timeframe a deep and illogical correction.

The market seems to have forgotten that the Bank of England will lower its key rate just like the Fed and that the UK economy has been struggling since Brexit in 2016. All this time, the US economy has consistently outperformed the UK's over the last two years.

Despite this, market makers drove the pound higher, and analysts justified the rally with incorrect reasoning. This created an illusion of legitimacy for the pound's rise. It does not matter how much the pound has fallen over the past 16 years. However, what truly matters is the ongoing downtrend. The trend remains bearish until convincing signs of its end emerge (e.g., a 1,600-pip rally from current levels). While such a rally is possible, the question remains: what would be the fundamental justification?

This image is no longer relevant

The GBP/USD pair's average volatility over the last five trading days is 86 pips, which is considered "average." On Wednesday, November 20, the pair is expected to trade within the range of 1.2589 to 1.2761. The higher linear regression channel has turned downward, signaling a bearish trend. Despite multiple bullish divergences on the CCI indicator and occasional oversold conditions, no meaningful corrections have occurred.

  • Support Levels:
    • S1: 1.2634
    • S2: 1.2573
  • Resistance Levels:
    • R1: 1.2695
    • R2: 1.2756
    • R3: 1.2817

Trading Recommendations:

The GBP/USD pair continues its downward trend. We do not recommend long positions, as the factors supporting the pound's rise have already been priced in multiple times. For those trading based solely on technicals, longs may be considered above the moving average with targets at 1.2817 and 1.2878. However, short positions remain more relevant, with targets at 1.2589 and 1.2573 as long as the price remains below the moving average.

Explanation of Illustrations:

Linear Regression Channels help determine the current trend. If both channels are aligned, it indicates a strong trend.

Moving Average Line (settings: 20,0, smoothed) defines the short-term trend and guides the trading direction.

Murray Levels act as target levels for movements and corrections.

Volatility Levels (red lines) represent the likely price range for the pair over the next 24 hours based on current volatility readings.

CCI Indicator: If it enters the oversold region (below -250) or overbought region (above +250), it signals an impending trend reversal in the opposite direction.

Pilih carta masa
5
min
15
min
30
min
1
jam
4
jam
1
hari
1
minggu
Jana pendapatan melalui perubahan kadar mata wang kripto dengan InstaForex.
Muat turun MetaTrader 4 dan buka dagangan pertama anda.
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    SERTAI PERADUAN

Artikel yang dicadangkan

Nilai Dolar A.S. Terus Menurun

Dolar A.S sedang menghadapi tekanan ke bawah, yang membolehkan beberapa aset berisiko mengukuh, walaupun terdapat ancaman perang perdagangan yang mungkin menjejaskan ekonomi global dalam masa terdekat. Pendekatan berhati-hati oleh pegawai-pegawai

Jakub Novak 08:01 2025-02-17 UTC+2

Apa yang Perlu Diberi Perhatian pada 17 Februari? Penjelasan Peristiwa Fundamental untuk Pedagang Baharu

Tidak ada peristiwa makroekonomi yang dijadualkan pada hari Isnin. Minggu lalu, kedua-dua euro dan pound mengalami pertumbuhan yang ketara walaupun ketiadaan latar belakang makroekonomi atau fundamental yang kukuh. Walaupun terdapat

Paolo Greco 06:25 2025-02-17 UTC+2

Gambaran keseluruhan Pasangan GBP/USD pada 17 Februari: Pound British Nikmati Momentum Euro

Pasangan mata wang GBP/USD mengalami peningkatan pada hari Jumaat. Kadangkala, pasaran berkelakuan dengan cara yang hampir tidak dapat dipercayai. Ramai pedagang dan penganalisis terbiasa dengan idea bahawa pergerakan harga dipengaruhi

Paolo Greco 02:49 2025-02-17 UTC+2

Gambaran Keseluruhan Pasangan EUR/USD pada 17 Februari: Peningkatan Ketara dalam Euro yang Tidak Bermakna

Pada hari Jumaat, pasangan mata wang EUR/USD meneruskan kenaikannya yang pesat. Pada permulaan minggu, kami berhati-hati mengenai kenaikan seterusnya euro, tetapi menjelang akhir minggu, menjadi jelas bahawa pergerakan ini bukan

Paolo Greco 02:49 2025-02-17 UTC+2

EUR/USD – Pratonton Mingguan: Minit FOMC, Indeks PMI dan ZEW, dan Pertikaian Tarif Dagangan

Minggu lalu, EUR/USD menguji tahap 1.0500 tetapi gagal untuk mengukuhkan melebihi rintangan utama ini (garisan atas penunjuk Bollinger Bands pada jangka masa D1). Pertumbuhan impulsif pasangan mata wang ini didorong

Irina Manzenko 23:20 2025-02-16 UTC+2

Apa yang Harus Diperhatikan pada 14 Februari? Peristiwa Fundamental untuk Pedagang Baharu

Peristiwa makroekonomi pada hari Jumaat ini tidak terlalu banyak mahupun terlalu sedikit. Zon Euro akan mengeluarkan anggaran kedua KDNK untuk suku keempat, yang secara objektifnya kurang signifikan berbanding anggaran pertama

Paolo Greco 07:21 2025-02-14 UTC+2

Tinjauan Pasangan GBP/USD pada 14 Februari: Pound British Terus Menerus Mengalami

Pada hari Khamis, pasangan mata wang GBP/USD menguji paras Murray "5/8" pada 1.2512 untuk kali ketiga dalam beberapa hari kebelakangan ini. Satu lagi lantunan dari paras ini membawa kepada penurunan

Paolo Greco 04:36 2025-02-14 UTC+2

Gambaran Keseluruhan Pasangan EUR/USD pada 14 Februari: Pasaran Mendatar dan Kekeliruan Berterusan

Pada hari Khamis, pasangan mata wang EUR/USD cuba untuk meneruskan pergerakan ke atasnya, namun usaha ini kebanyakannya tidak berjaya, menyebabkan penurunan pada separuh akhir hari. Secara keseluruhan, pasangan EUR/USD kekal

Paolo Greco 04:35 2025-02-14 UTC+2

GBP/USD. Dorongan untuk Pound: Sterling Meningkat Seiring Pemulihan Ekonomi UK

Pound British meningkat kepada tahap tertinggi mingguan baru berbanding dolar AS pada hari Khamis, bertindak balas secara positif terhadap penerbitan data ekonomi terkini UK. Kebanyakan komponen laporan itu keluar dalam

Irina Manzenko 23:45 2025-02-13 UTC+2

Euro Sudah Bosan dengan Perang

Jika Rizab Persekutuan mampu memperlahankan pengembangan monetari, mengapa Bank Pusat Eropah tidak melakukan perkara yang sama? Kenyataan daripada Presiden Bundesbank Joachim Nagel menunjukkan bahawa, ketika ECB menghampiri tahap neutral

Marek Petkovich 23:45 2025-02-13 UTC+2
Tidak boleh bertanya sekarang?
Tanya soalan anda di Ruangan bersembang.
Panggilan semula Widget
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.