- GBP/USD trades nearly half a percent higher as the dollar weakens further.
- The psychological 1.25 level has been broken and it was looking like a strong resistance.
GBP/USD 1-hour chart
The USD has once again been the underperformer in the FX markets as the risk-on environment continues. This has lead the price of GBP/USD to push higher despite GBP not really being one of the strongest of the G10 currencies on Tuesday. EUR/GBP and GBP/AUD can be our barometer with the pound struggling in both pairs.
Looking at the 1-hour chart below, the 200 Simple Moving Average has been taken out. The indicator was closely aligned with the 38.2% Fibonacci retracement and both have now been rendered obsolete but the push higher in the pair.
The next resistance point is now at the 50% Fibonacci retracement zone and beyond that the red line at 1.2612. As you can see from the chart below the blue downward sloping diagonal trendline has now been broken and there is a tendency for price to retest a trendline once broken.
The purple upward sloping trendline is the one to watch. Any break below could mean the price could be heading back down. Until that point at least the bulls are in charge.
Looking at the technical indicators the Relative Strength Index has a small divergence forming which could mean the price is ready to pullback. Around 1.2550 is a pretty sticky-price zone so the price could struggle to move beyond there but it does depend on the extent of the USD weakness at the moment.
-637285264085698381.png)
Additional levels
All information and content on this website, from this website or from FX daily ltd. should be viewed as educational only. Although the author, FX daily ltd. and its contributors believe the information and contents to be accurate, we neither guarantee their accuracy nor assume any liability for errors. The concepts and methods introduced should be used to stimulate intelligent trading decisions. Any mention of profits should be considered hypothetical and may not reflect slippage, liquidity and fees in live trading. Unless otherwise stated, all illustrations are made with the benefit of hindsight. There is risk of loss as well as profit in trading. It should not be presumed that the methods presented on this website or from material obtained from this website in any manner will be profitable or that they will not result in losses. Past performance is not a guarantee of future results. It is the responsibility of each trader to determine their own financial suitability. FX daily ltd. cannot be held responsible for any direct or indirect loss incurred by applying any of the information obtained here. Futures, forex, equities and options trading contains substantial risk, is not for every trader, and only risk capital should be used. Any form of trading, including forex, options, hedging and spreads, contains risk. Past performance is not indicative of future FX daily ltd. are not Registered Financial Investment Advisors, securities brokers-dealers or brokers of the U.S. Securities and Exchange Commission or with any state securities regulatory authority OR UK FCA. We recommend consulting with a registered investment advisor, broker-dealer, and/or financial advisor. If you choose to invest, with or without seeking advice, then any consequences resulting from your investments are your sole responsibility FX daily ltd. does not assume responsibility for any profits or losses in any stocks, options, futures or trading strategy mentioned on the website, newsletter, online trading room or trading classes. All information should be taken as educational purposes only.
Recommended content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.