Weekly recap – The GBPUSD has lost upside momentum
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The GBPUSD has been struggling with the 1.4250 resistance for the last few weeks and the problem with this has been a divergent RSI and also it was at the old February highs(1.4241) from earlier this year. We are in an ascending channel with support just above the 1.4000 level. The risk is tomorrow. A strong jobs report could put some upside pressure on the US Dollar across the board, and this could put the Cable below the 1.4000 level. A move like that would stir up talk of a long term double top developing. Cable bulls should be careful with tomorrow’s jobs data.
The NZDUSD is nearing wedge support
With elevated asset prices and inflation expectations running hot, the risk of the NZDUSD bouncing off the wedge support at the .7190 level seems pretty high. Also consider that we have the wedge trend line support, and a 61.8% Fibonacci retracement level of the May range comes in also at the .7190 level. Below this support would put the .7100 level in view, but our base case is for a rally back to the .7300 level wedge resistance.
Gold stalling near key resistance
The breakout above channel resistance mid May has allowed for a strong rally past the 200dma in gold. However, the daily RSI is overbought and trying to turn lower. The daily candle is an outside day suggesting that we may turn lower tomorrow. Also, the key 61.8% Fibonacci retracement at the 1921 level may stall the advance for now. We’d expect dips back to the 200dma near the 1840 level to hold any near term pullback.
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