FxWirePro: Cable’s swing in sloping channel turns into rising channel, upswings edgy on poor construction PMI, consolidation phase intact on bullish crossovers

The minor trend of cable (GBPUSD) has broken out sloping channel resistance and formed rising channel.

Is it puzzling? Yes, we meant GBPUSD swings.  

Ever since the formation of the hammer at 1.3775 levels, the price behavior of this pair that was sliding through sloping channel has now transformed into the rising channel.

However, shooting star pop up at 1.4096 levels to signal weakness at that juncture, as a result, the upswings are again restrained below one more stiff resistance at 1.4244 levels.

For now, more price dips can be expected if it breaks decisively below the channel support (refer daily chart), we see weakness in this prices on the prints of disappointing UK’s construction PMIs, actual 47.0 versus forecasts at 50.9 and previous at 51.4.

On a flip side, in the broader perspective, the bulls in consolidation phase spike well above EMAs (refer monthly plotting), while both leading oscillators in tandem with these upswings, more rallies likely on bullish EMA & MACD crossovers.

Both RSI and stochastic curves converge upwards to the ongoing upswings on monthly timeframes.

Trade tips: On an intraday speculative basis, contemplating sideway trend for the day, we advocate tunnel spread which is a binary version of debit put options to leverage yields. At spot reference: 1.4025, use upper strikes at 1.4068 and lower strikes at 1.3988 levels. The payoff structure would be certain and exponential as long as the underlying spot FX remains between these strikes on binary expiration.

Currency Strength Index: FxWirePro's hourly GBP spot index is inching towards -30 levels (which is bearish). While hourly USD spot index was at shy above 10 (absolutely neutral) while articulating (at 12:26 GMT).

For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex

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