Weekly
   •   Last Candlesticks pattern: Shooting star
   •   Time of formation: 31 Jul 2017
   •   Trend bias: Down
Daily
   •   Last Candlesticks pattern: Morning star
   •   Time of formation: 25 Aug 2017
   •   Trend bias: Near term up
GBP/USD – 1.3520
Cable only eased to 1.3153 last week before surging again, price rallied to as high as 1.3619 yesterday before easing, suggesting minor consolidation would take place and initial pullback to 1.3450-60 cannot be ruled out, however, reckon 1.3380-85 would contain downside and bring another rise later, above 1.3619 would extend medium term erratic upmove from 1.1986 low to 1.3650-55 (100% projection of 1.1986-1.3048 measuring from 1.2589), then 1.3700, however, near term overbought condition should limit upside to 1.3800 and reckon 1.3860 (61.8% Fibonacci retracement of 1.5018-1.1986) would remain intact, bring retreat later.
On the downside, whilst initial pullback to 1.3470-80, then 1.3450 cannot be ruled out, renewed buying interest should emerge around 1.3400 and bring another rise. A daily close below support at 1.3382 would bring test of the Tenkan-Sen (now at 1.3319) but break there is needed to suggest a temporary top is possibly formed, bring retracement of recent rise to 1.3240-50, then1.3200, having said that, reckon said support at 1.3153 (last week’s low) would remain intact, bring another rally later.
Recommendation: Buy again at 1.3400 for 1.3600 with stop below 1.3300. Â



On the weekly chart, last week’s rally formed another long white candlestick (even longer than the previous one), adding credence to our bullish view that recent erratic upmove from 1.1986 low is still in progress and may extend further gain to 1.3650-55 (100% projection of 1.1986-1.3048 measuring from 1.2589), break there would bring subsequent rise to 1.3750-60 but near term overbought condition should prevent sharp move beyond 1.3860 (61.8% Fibonacci retracement of 1.5018-1.1986) and bring retreat later.
On the downside, although initial pullback to 1.3445-50, then 1.3400 cannot be ruled out, reckon downside would be limited to 1.3380-85 and bring another rise later. Below 1.3300 would defer and risk test of the upper Kumo (now at 1.3247) but still reckon last week’s low at 1.3153 would hold and sterling may head north again from there. Only a drop below this support would defer and suggest a temporary top is formed, bring correction of recent rise to 1.3090-00 and possibly towards psychological support at 1.3000 but the Kijun-Sen (now at 1.2992) should limit downside.
 

