GBP/USD sitting on strong support and eyeing higher levels — Confluence Detector

GBP/USD has extended its gains amid a better market mood and ahead of the UK's announcement about extending its lockdown. How is cable positioned? 

The Technical Confluences Indicator is showing that GBP/USD benefits from robust support at 1.2596, which is the convergence of the Fibonacci 38.2% one-day and the Simple Moving Average 100-15m. 

Resistance is also close but is somewhat weaker. At 1.2610, we find a cluster including the Bollinger Band 1h-Middle, the SMA 10-15m, and the SMA 5-4h. 

The next cap is only at 1.2695, which is the meeting point of the Pivot Point one-day Resistance 1 and the PP one-week R2. 

Below 1.2596, the next cushion is at 1.2518, which is the confluence o the BB 4h-Middle and the Fibonacci 61.8% one-month. 

The next cushion is at 1.2491, which is the meeting point of the SMA 5-one-day and the previous weekly high. 

This is how it looks on the tool:

Confluence Detector

The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. This means that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.

Learn more about Technical Confluence