GBP USD - Full analysis to the imbalanceHello traders and analysts,
GBP USD full breakdown technical analysis.
A note before reading - this is a forecast analysis - based upon Lupa Capitals trading strategy.
Please do not take this as face value and conduct individual entry points whether looking for long or short positions (time frame dependent).
Master Key:
Blue = Monthly
Purple = weekly
Orange = Daily
Grey = 4hour
Pink = 1 hour
Weekly and monthly imbalances combined
Price has moved from the monthly low of 1.1430 where price has immediately become oversold and an obvious imbalance has occurred here. The buyers imbalance has now taken over upon the Dollar strength - for it's position as a safe haven when looking at a fundamental view.
From here price has moved and closed between a newly created imbalance zone between 1.143 and 1.1980 - a huge imbalance but price has reached its double top for the DXY.
Weekly imbalances:
The cable had successfully stabilised within the zone above the imbalance over extension and has become bullish again completing a clear path to 1.35XX. The reason behind this is the imbalance has enough buying power within the next cycle to take price to the previous sell imbalance. However, the consolidation or breathing point for the cable can be marked between 1.308 to 1.32.
Daily imbalances
Look left to see where price has created "liquidity zones", these are the imbalances which match the weekly time frame so the candle using weekly and monthly for our structure shows, the long term selling imbalance is at 1.35XX. This area of imbalance had previously been tested by the bulls but maintained structure. However, price over the course of 847 days price has reached the imbalance four times, slowly but surely adding pressure to this 'swap zone'.
Here is the wider daily picture.
Daily Fibonacci - imbalance to test 50% daily zone for bullish run.
Imbalance view - using Fibonacci has been a great opportunity here for positional buyers to buy in.
The reason for this zone was important is the imbalance swing to a 50% retrace is clear on this pair where price looks to this pivot point more often than not. The second reason is due to the fact that the bullish momentum impact here caused a nice opportunity for the price to re-engineer a profit taking for sellers imbalance and convert to buyers.
Here is the current scenario, heading towards the extension -0.618 or 1.618 in extension Fibonacci terms.
GBP USD VS GBP Futures
both heading for the imbalance as the futures are aligning to the current market price.
See the previous update to our explanation to see further review tools and analysis takes:
Where will price take us from here?
The USD will continue to see a deepening soft dollar, which is what the US want right now to keep pushing the stocks into 2021 with cheaper import/exports as a major player. Furthermore a cheaper dollar will boost 2021 visitors to the US and see Gold rushed to as a hedge of inflation .
GBP we have a weekly zone the pound has now surpassed creating a good new daily demand to move further.
The monthly zone towards 1.50 as our target for a position buy. Before this zone on the daily to take us to 1.44 on our weekly zone.
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