GBPUSD (6B) Futures high level analysis
6B is a great instrument to trade if you are looking to get started trading Currency Futures. Below is a high level analysis from the monthly chart down to the daily, setting out our expectations on the different timeframes in order to guide our trading over the next period.
The 6B is in a very extended but not yet fully compounded long leg having reached 1.4250 in February and very near to this level again in May. The thrust of the market is higher with previous highs at 1.3500 having been taken out earlier in the leg. A pullback to the 1.3500 level can be expected before a renewed run higher is likely. The pullback may have started this month and is looking likely to get to 3500 at least before returning higher.
The weekly 6B however is looking a lot weaker than the monthly, where the current short leg which has only just started is currently basing and is looking like continuing a correction, likely to reach the 3400 level but possibly as deep as 1.3200. Price has taken out previous lows and the leg is fully engaged and underway with an estimated one to six weeks to run.
The daily 6B chart, which put in an extended leg short has tried to pull back but failed at the 4000 level and is heading lower. As the daily has taken out the 3700 level, there is little resistance until the 3500 or even the 3200 level.
The 6B is long on the monthly but is ripe for a correction which could be in the form of a fuller correction down to 3500 or even 3200. There was ample opportunity to get into the correction and trade it down to the likely re-entry levels long but we are approaching the end of the correction and while there may be scope for further downside from current price but we are possibly approaching the end of the move with a possible 1-6 days of further downside before a correction is likely. The monthly and weekly corrections are on the way as is the daily, which has changed status to a short trend.
This type of analysis should benefit you whether you are trading for long, medium or short term gains and only aims to give you levels of significance and areas where to enter and exit trades. Lower timframe analysis is then required to ensure that optimum entry levels are achieved.