Last week saw solid gains in GBPCAD for a 2nd week in a row. This strong investor demand turned our medium term signals for sentiment to positive.
At the end of April/beginning of May, the decline from March’s high led to a negative (dead) cross in both spot GBPCAD and our RSI indicator – breaking the 21 week moving averages of both – first in RSI and, confirming, then the spot price.
GBPCAD then moved, until August’s low, more than 7 1/2 big figures lower. Spot and RSI indicators staying below their moving average throughout that period. Th rally from August’s low failed at the moving averages but the subsequent renewal of selling pressure took spot GBPCAD back to the same levels, marginally below 1.6600, at the beginning of this month.
It is the bounce from that ‘double bottom’ that has now created positive (golden) crosses in both the spot and RSI and has, therefore, turned our technical studies bullish for the coming weeks.
The immediate upside focus is on 1.7480, July’s high, then a more significant 1.7775, June’s peak, – a level that coincides, currently, with the top of the Ichimoku Cloud pattern.
Only a weekly close below the 21 week moving averages would threaten this positive GBPCAD outlook.
About FX Renew
This blog post was published on www.fxrenew.com, a provider of Forex signals from ex-bank and hedge fund traders (get a free trial). If you like this post, subscribe to the blog for free or get free access to the acclaimed Advanced Forex Course for Smart Traders.
The post GBPCAD – Sentiment Turns Bullish appeared first on FX Renew.