GBP/USD Forecast: Could push into Fib resistance
The GBP/USD pair fell to a low of 1.4879 in the Asian session on Tuesday, after having faced rejection at the 50-DMA in the previous session. The pair lacked any fresh fundamental trigger on Monday and was guided by market’s appetite for the US dollar. Moreover, the USD made a comeback across the board as the Treasury yields strengthened. However, we see the 10-year yield in the US has weakened 1.6 basis points today to trade at 1.881%, which could support the British Pound. Again, we do not have a major market moving data due for release today out of the UK, hence the pair is likely to move in line with the overall market sentiment. The sell-off in the EUR/GBP cross due to the Greek issue could support the GBP/USD pair as well.
On the hourly chart, we see the pair currently trading at the 100-MA located at 1.4892, after having found support at 1.4879 levels in the Asian session. The bullish RSI at 51.12 could ensure the pair manages to sustain above hourly 100-MA and make its way towards 1.4942 (38.2% Fib retracement of 1.5550-1.4564). A fresh bid wave is seen coming in the early European session if the pair manages to sustain above 1.4892. Meanwhile, the GBP could see a renewed a sell-off below 1.4865 (38.2% Fib retracement of 1.4564-15051). However, the pair is more likely to test 1.4942 since it has recovered from the lows of 1.4876.
EUR/USD Analysis: Could re-test 5-DMA
The shared currency weakened on Monday as falling long duration bond yields in the core Eurozone nations like Germany reduce its appeal as a growth currency. The Greek issue also kept the EUR under pressure,. Consequently, the EUR/USD pair fell to a low of 1.0711, before finishing at 1.0747 levels. The German Zew survey indices due for release are likely to show an improvement in the Current Situation and Economic Assessment. The Eurozone Economic Sentiment index is also expected to show an improvement. The ECB’s QE program is expected to have improved conditions across the Eurozone. A better-than-expected or in-line with the expectations data could see the pair rise to its 5-DMA located at 1.0768. On the other hand, the pair could drop in case the Zew survey shows worsening of sentiment.
On the charts, the pair found support at 1.0712 (23.6% Fib retracement of 1.1532-1.0461), which also happens to a double top neckline. At the moment, the pair is trading near the same level, with the daily RSI bearish at 45.65. A rising trend line support on the hourly chart is also seen at 1.0712. Thus, the pair could make an attempt at its 5-DMA located at 1.0768 if it manages to sustain above 1.0712 levels. On the other hand, a break below 1.0712 could see the pair test 10-DMA at 1.0692. Given the expectation of a positive Zew survey data, the pair is likely to sustain above 1.0712 and rise to its 5-DMA at 1.0768.
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