Pound Sterling P&F Forecasts vs EUR, USD, AUD, NZD, CAD
We take a round-trip of the British pound's main trading pairs looking at forecasts and price action from the perspective of a unique but simple charting method.
This article includes chart forecasts for GBP/EUR, GBP/USD, GBP/AUD, GBP/NZD and GBP/CAD using a method of charting rates called Point & Figure.
Point & Figure Charts originate from the United States at the end of the 19th century when pit traders would use them as a short-hand way of keeping track of price action during fast-moving sessions.
They are made up of noughts and crosses, with a nought representing a fall in price and a cross a rise.
The advantage of these charts is that they help to cut out unnecessary noise and highlight the trend.
Another unique characteristic is that they provide clear-cut targets, and unambiguous buy and sell levels.
Please note when the chart commentary below mentions point and figure “counts” it means targets.
There are two stages to establishing targets – the initial stage when the ‘count’ is theoretical and is described as “fixed” followed by the second stage when it is “activated” by a breach of a confirmation level, after which time it becomes ‘live’.
Once it is live the market is expected to reach that level.
Research has found point and figure charts are quite accurate predictors of price.
Indeed, it may not be an exaggeration to say that the point and figure chart proves that it is indeed “hip to be square” in the immortal words of Huey Lewis and the News.
Please note, all the charts below are considered medium term in outlook, with 100 point squares - and for P&F aficionados - are all 2-box reversal charts on a daily timeframe.
GBP/EUR
The chart is showing the exchange rate is in a down-trend, as it has broken below the 50 period MA and the current trend-line is red and bearish.
There are currently no active counts but a very bearish count has been fixed to 1.0200, which will require a move below 1.2800 to activate.
GBP/USD
The chart is showing the pair is in a down-trend as the most recent trend-line is a red bearish trend-line.
The previous active count (target) was met when the rate fell to 1.4500.
There are no current active counts but there is a very bearish count fixed all the way down to 1.20, which will be activated if the exchange rate reaches 1.40.
GBP/AUD
A down-trend is firmly in place with an active count to 1.9800, which is as yet still unmet.
GBP/NZD
The trend has changed from bear to bull – if only embryonically – and there is an up count to 2.25 which has not yet been met.
GBP/CAD
The pair is in a down-trend and has just pierced below the 50-MA.
It has almost but not yet quite met the current active count to 1.98.
