Daily support at 1.3878 now eyed...
The British pound resumed its downside trajectory on Monday, forming a full-bodied daily bearish candle in the process. This move, which looks to have begun following a lower-than-expected UK services PMI reading, eventually dragged price beneath multiple tech supports, including weekly support at 1.4079 (now acting resistance).
Also worth noting is that daily price ended the day closing within striking distance of a daily support at 1.3878, which happens to house a daily AB=CD (see black arrows) 127.2% correction point at 1.3883 and a 38.2% daily Fib support at 1.3849.
Across on the H4 timeframe, we can see that H4 movement recently crossed below the 1.40 landmark in strong fashion and apart from the minor H4 demand circled in green at 1.3915-1.3955, the path south appears relatively free down to 1.39.
Potential trading zones:
Daily support mentioned above at 1.3878 and its merging AB=CD formation, along with the 1.39 handle on the H4 timeframe, is certainly an area (green zone) traders likely have their crosshairs fixed on today.
Although we really like the noted green zone, traders also need to be prepared for the possibility of price extending losses today/this week. This is due to weekly price showing a reasonably clear path down to weekly support at 1.3683.
Data points to consider: No high-impacting events seen on the docket.
Also worth noting is that daily price ended the day closing within striking distance of a daily support at 1.3878, which happens to house a daily AB=CD (see black arrows) 127.2% correction point at 1.3883 and a 38.2% daily Fib support at 1.3849.
Across on the H4 timeframe, we can see that H4 movement recently crossed below the 1.40 landmark in strong fashion and apart from the minor H4 demand circled in green at 1.3915-1.3955, the path south appears relatively free down to 1.39.
Potential trading zones:
Daily support mentioned above at 1.3878 and its merging AB=CD formation, along with the 1.39 handle on the H4 timeframe, is certainly an area (green zone) traders likely have their crosshairs fixed on today.
Although we really like the noted green zone, traders also need to be prepared for the possibility of price extending losses today/this week. This is due to weekly price showing a reasonably clear path down to weekly support at 1.3683.
Data points to consider: No high-impacting events seen on the docket.
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