Technical, Fundamental Factors Hold GBP USD Rangebound

The GBP USD continued to trade inside of the September 30outside range day at 1.5922 to 1.5668. This pattern has temporarily frozen the trade as traders await thelatest monetary policy statement from the Bank of England on October 7. A pairof Gann angles is also forming a triangle between 1.5895 and 1.5676. Thisformation is also helping to confine trading activity.

The GBP USD continued to trade inside of the September 30outside range day at 1.5922 to 1.5668. This pattern has temporarily frozen the trade as traders await thelatest monetary policy statement from the Bank of England on October 7. A pairof Gann angles is also forming a triangle between 1.5895 and 1.5676. Thisformation is also helping to confine trading activity.

If Monday was any clue, then traders should look for much ofthe same action until the central bank meeting. In addition, the release of theU.S. Non-Farm Payrolls Report on Friday may also keep traders on the sidelines.

British Pound speculators are focusing on the possibilitymembers of the BoE are leaning toward restarting the bank’s quantitative-easingprogram.

The Dollar/Yen gained ground on Monday as traders speculatedthe Bank of Japan would leave interest rates unchanged at 0.1% while perhapsannouncing further easing measures to combat the rise in the Yen.

Gann angle support at 83.28 has slowed down the USD JPYdecline the last few days, but the charts indicates there is room to fall to82.88 if this angle fails.

Traders are approaching the short-side with caution becauseof the possibility of another intervention. Either way one looks at it,speculators seem to be testing the resolve of Japanese government officialswith each lower-low this market makes.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More

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