Forex Video Briefing (7/1) – GBP/USD and AUD/USD in Fresh 2014 Highs
The GBP/USD is extending a rally into new highs on the year, to levels not seen since 2008. The weekly RSI is above 70, showing a bullish trend in place, but also warning of overbought conditions. The daily chart also has a bullish but possibly overbought RSI reading. Even the 4H RSI is above 70. Watch out for pullbacks in up coming sessions. However, there are no signs why traders won’t continue to buy on dips. The next key level to monitor is around 1.7337, 50% retracement of the 2008 decline.
Let’s not forget the Aussie, which was just as strong as the sterling pound. This week so far, we saw AUD/USD break above the previous 2014 high which was at 0.9445. This rally also broke what looks like an ascending triangle consolidation in June. When looking at the daily chart, you see that the market has the 0.9543 level in sight in the short-term. This week’s bullish continuation signal also exposes the 2013 high of 0.9756. The daily RSI in 2014 has tagged above 70 and held above 40 on the dip (given some elbow space). Now the RSI is popping back above 60 with some room before getting above 70, giving traders overbought outlooks.