What is GBPUSD doing now? Is that a double top?
Do you see what I see in GBPUSD?
This was what I posted in Twitter.
Two members of our community came back.
@Sohtionghum There's no confirmation of a DT still looks supported. Sigh, I would like some GBP weakness though.
— victoria yam (@PatissierYam) October 28, 2013
Seeing a double top
In my opinion, learning is most effective when there is participation. From my end, at least I can see what is going on inside your mind. So I applaud these two participants.
As a summary of their feedback, both spotted double tops. This is what an envisioned double top looks like. Entirely thinkable, good symmetry, nothing wrong at all.
What I see is a GBPUSD building to go higher
The key consideration is that green zone I drew over there as well as the two question marks ?? right below. This green zone is a support at the moment. It is a support because:
- Price touched the zone twice and bounced up showing well… support
- The level is also a former resistance. So we are looking at the technical concept of ‘support resistance are interchangeable’.
There is one other thing. The green zone is bounded on the top by the level 1.6184. This is GBPUSD’s opening level at the start of trading on the first trading session of October. Above 1.6184, price is bullish. Below 1.6184 price is bearish. I wrote two articles about this. If you don’t know what I am talking about, please read:
Open Price as market sentiment gauge: Gold price bullish Silver not
Basically the technical picture of GBPUSD is this:
- Price is above support and above its October open price so bulls are secure and happy. If you are bearish, you got some levels to beat.
- If the green zone can be broken so that price goes below, we very well have a double top chart pattern.
- If the green zone cannot be broken which we are seeing price action go sideway, this is a pair building base to go higher.
Lo and behold, see the 1-2-3-4 pattern.
Plan according based on this green zone.
Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’. Operates multiple strategies.
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