NinjaTrader trend monitor indicator continues to confirm GBP/USD weakness

GBP/USD daily chart

GBP/USD daily chart

The first day of the new trading year was a seminal one for Cable, with the pair selling off sharply on the day and closing with a wide spread down candle wich saw the GBP/USD finally breakdown and through the sustained platform of support in the 1.5450 region, built during the congestion phase of December. Whilst the initial trigger for Friday’s move was the weaker than expected PMI data in the UK, it is the resurgent US dollar which is continuing to drive the major currency pairs lower, with the US dollar index now climbing through the 91 region and preparing to test the 92 region. Friday’s price action was also validated with high volume confirming the heavily bearish tone for Sterling.

The NinjaTrader indicators are also confirming this picture with the currency strength indicator to the left of the chart suggesting that the British pound, the yellow line, has some way to travel before reaching an oversold state on the daily chart, and now descending steeply, reflecting the strenght of the current momentum. The Quantum trend monitor at the bottom of the chart continues to remain bearish and with the deep area of price congestion now in place overhead, we can expect to see the pair pick up the pace of downwards momentum and on to test the 1.5000 region in due course.

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