GBP/CAD: bearish bias persists below 1.7020

GBP/CAD has been in free fall to a low of 1.6795 so far.

"GBPCAD has lost more support today, moving below minor support at 1.7025/30 and losing psychological support at the 1.70 line," noted analysts at Scotiabank.

"The GBP remains broadly vulnerable following the break under the base of the July consolidation (bear wedge) which targets a retest of the 1.67 level and new long-term cycle lows. We spot minor resistance now at 1.7025/30 and, stronger, in the mid-1.75 area. We continue to feel that the GBP needs to recover through 1.7550 on a sustained basis to stabilize the bear trend."

How volatile has GBP/CAD been?

On the hourly GBP/CAD chart, ATR (14) is presently at 37 pips, while 2-Standard Deviation Volatility Bandwidth is expanding and currently 215 pips. On a daily chart, 2-Standard Deviation Volatility Bandwidth is shrinking at 541 pips. Over the past four weeks, 37 pips has been the average movement for the current session. Following the four week period average, today’s most volatile hour was between 11:00-12:00 GMT which has an average movement of 178 pips.

What price levels and patterns have to be considered?

Spot is presently trading at 1.6814, and next resistance can be seen at 1.6865 (Daily Classic S2), 1.6926 (Daily Classic S1), 1.6933 (Hourly 20 EMA), 1.6956 (Yesterday's Low) and 1.6988 (Monthly Low). Support below can be found at 1.6796 (Daily Low), 1.6773 (Daily Classic S3), 1.6767 (Weekly Classic S2), 1.6761 (Annual Low) and 1.6761 (YTD Low).