GBPUSD Signalling A Bearish Correction

GBPUSD Signalling A Bearish Correction

Dollar gains afer retail sales surprises to the upside

Euro Weakens To A Seven-Day LowGBPUSD Signalling A Bearish Correction - 1

The euro currency is accelerating the pace of declines comparing to the previous few days. On an intraday basis, the euro slipped to a seven session low before recovering slightly.

The declines come as the EURUSD has now breached the rising long term trendline once again.

Still, given the recent rebound after the trendline breach on 5th February, we could see a recovery once again.

Therefore, to the downside, only a confirmed close below 5th February lows of 1.1951 will see further declines coming.

Meanwhile, to the upside, a reversal could see the trendline coming in as resistance or the euro could possibly breakout above the trendline once again.

The long term correction could see the 200-day moving average being tested which currently sites around the 1.1800 region.

The British pound sterling is extending declines following a flat close on Tuesday. Still, price needs to close below Tuesday’s low of 1.3901 to confirm further downside.

The next immediate downside target is seen near 1.3733 where price established strong resistance previously. This price level forms the ideal target to the downside with support likely to come in.

But in the event that the GBPUSD loses this handle, we might get to see further declines. This will push the cable down to the 1.3500 level which is pending a retest anyways.

To the upside, price action will need to post a reversal and possibly rise above the Tuesday highs of 1.3950 in order to maintain the uptrend.

WTI Crude Oil Inches Higher But Likely To Close FlatGBPUSD Signalling A Bearish Correction - 2

WTI crude oil is showing signs of losing its bullish momentum. Price action is seen struggling to get a foothold above 60.00.

This has led to price action being rejected over the past three trading sessions. For the moment, the overall bias remains firmly to the upside.

But this could change if oil prices close below Tuesday’s low of 59.31. This will potentially confirm the downside for the short term. The long term trendline will act as support in case of such a move.

To the upside, oil prices are nearing the 61.35 level which marks the highs from 8th January. Given the current momentum it is unlikely to see oil prices rising further unless there is a strong breakout above 61.35.

Gold Prices Fall To A Two-Month LowGBPUSD Signalling A Bearish Correction - 3

The precious metal resumes its declines with price action currently trading near the 1777.50 level.

The decline marks a new two-month low in the commodity. A break down below this level could further accelerate declines.

Still, considering that this support level has held up previously around early December last year, the precious metal could post a rebound.

The daily Stochastics oscillator is also nearing the oversold levels. This could coincide with the support level holding up.

However, if the precious metal loses this support, we could see prices potentially falling to the next key support level near 1650.

John Benjamin

John Benjamin

John Benjamin is a Macro-Analyst at Orbex. John has over 8 years of experience specializing in the currency markets, tracking the macroeconomic and geopolitical developments shaping the financial markets. John applies a mix of fundamental and technical analysis and has a special interest in inter-market analysis and global politics.