British Pounds Fighting Back ?

 The GBP has been slammed down since late November last year due to the looming Greek crisis. Recently with the oncoming election which many are worried about a new hung parliament and  more problems to come from the Club Med area, we get to read more extreme bearish news all over the place. But again, the chart seems to be telling the actual situation may be quite different from the main street views.

At the weekly GBPUSD chart, though I cannot find any divergence to call the return of a super bull. But the Stochastic has already crossed up above the 20's signal line and price managed to closed above the lower Bollinger Band. Both offer the initial buy signal. The MACD still remain negative but seems to be turning the corner. If prices can maintain in the coming weeks, we should see a positive cross up soon. The D- still dominates over the D+, so I cannot call a bull yet. But taking note that the ADX has already gone flat, at least the prior bear cycle has ended, at least for the time being.

 

The daily chart is more interesting as there may be an imperfect double bottoms on March 1st. and 25th. with MACD doing higher troughs which may be considered as a bullish divergence. The MACD has now crossed above its zero signal line which is more comforting for the bulls. But with a flat ADX at below 20's, I am also keeping an eye on the overbought Stochastic which is now crossing down above the 80's. So we may see some retracement and lingering around1.5180 level before we can see some real action later.

As long price can hold above the lower Bollinger Band, I think we may see some more bull coming out soon to "surprise" the main street "experts" again. I would NOT call this as a new bull cycle but merely a mighty technical rebound in a bear cycle.