After a healthy bullish streak by the British pound in the last two weeks, sellers might be getting ready to enter the market as the GBP/USD has made a double top at the 1.5650 resistance level last week. Although it closed in a bullish channel on Friday but in order to stay bullish, it must break this resistance level and sustain above it or else there are high chances of bears entering the market.
The pair is currently trading at 1.5623 at the start of the Asian trading session on Monday where a move below the support level of 1.5602 could bring it down further to 1.5570 and 1.5545. There is no key fundamental due for the GBP and USD today, so the market may also remain sluggish until the U.S. session starts. Technically there are more chances of the pair moving downwards because its bearish correction is also due for the bullish move it gave last week.
Time to Long on the USD?
Although the greenback underperformed against the major currency pairs and as well as gold in the past two weeks, but still it managed to stay firm against the Japanese yen. The pair USD/JPY closed in a bullish area on Friday where buyers are already intact where a move above its resistance level of 97.78 could take it up to 98.1, breaking of which would result in heavy buying where its short-term target would be 98.60.
There is a strong support intact at the 97.10 level, at which buyers would try entering the market again or if they fail to do so then the pair has its way down till the next support levels of 96.6 and 96.35.
I’m predicting the U.S. dollar to bounce back this and next week, as the U.S. stock market remains under pressure as the stimulus plan’s tapering is under high consideration by the FED members.
Happy Gold Buyers
Gold investors got a bit smile on their faces last week as the weakening U.S. dollar gave good support to the bulls to enter the gold market where they managed to take the metal to its long-awaited resistance level of 1375. Luckily it closed just above this level on Friday where its next targets are pretty clear where bulls may take gold to 1382 breaking of which can show 1403. On the downward side, it must break below 1372 to test the 1365 support level, followed by 1351 and 1346.
To contact the reporter of this story: Jonathan Millet at email@example.com