FxWirePro: Cable bulls strive for momentum, bears pop-up with shooting star – One touch binaries to trade and shorts in mid-month futures for hedging

We urge you to go through below weblink before we begin with this edition of technicals:

http://www.econotimes.com/FxWirePro-GBP-USD-interim-bulls-in-range-well-below-7-EMA-major-bear-trend-still-appears-to-be-intact--Deploy-DCPS-to-speculate-431439

Please be noted that it was then (on December 2nd) where spot FX was flashing at 1.2612, we had advocated diagonal credit put spreads. The strategy reads this way, short in 1W (-1%) in the money put, simultaneously, buy next month at the money -0.49 delta put option.

Well, ITM shorts have been certain yields by now, ATM delta instruments are on the verge of mitigating risks of slumps in this underlying spot FX.

For now, rallies may extend but the bulls’ attempts have been restrained within range 7EMA, rallies likely to see the stiff resistance of 1.2859.

Instead, shooting star pattern has been appeared at 1.2657 yesterday, struggling for bullish momentum (refer both daily and monthly technicals), both leading indicators confirm any bullish momentum.

But RSI & Stoch are indicative of further dips on monthly charts, whereas RSI on daily terms has been indecisive but slightly bears’ favor (trending in a linear direction above 57 levels).

Slow stochastic on the other hand noises with the attempts of %D line cross over even below overbought region on daily terms but no convincing bearish momentum.

Although monthly chart seems like more bulls swings on table, we advise not to rush with fresh longs, do you have any confirmation of reversal?

But on long term perspectives, dipping prices, volumes have been mammoth, leading & lagging indicators still signal weakness..! What else is required to confirm major downtrend?

While the current prices on this plotting are well below EMAs and the upswings seem to be restrained below 7EMAs.

Hence, on intraday perspectives, we advocate one touch binary put options to participate in prevailing bear sentiments and with leveraging effects in the profitability for minimum targets of 30-40 pips.

Alternatively, on hedging grounds, shorts in futures contracts of mid-month expiries as we call for targets upto 1.23 but a strict stop loss at 1.2859 is to be maintained.