Forex Trading Analysis: GPB/USD, Gold, EUR/USD

GBP/USD Forecast: Further losses likely in case 1.2100 is confirmed as resistance

(Eren Sengezer – FXStreet)

– GBP/USD has extended its slide at the beginning of the week.

– The near-term technical outlook points to a bearish shift.

– In the absence of high-tier data releases, risk mood could impact the pair’s action.

Following Friday’s decline, GBP/USD has extended its decline early Monday toward the 1.2100 area. In the absence of high-impact macroeconomic data releases, the risk perception could continue to drive the pair’s action and the bearish tilt in the near-term technical outlook suggests that further losses are likely.

Escalating geopolitical tensions between the US and China combined with weak data releases from China seem to be weighing on risk sentiment early Monday. Although the UK’s FTSE 100 Index is trading flat in the European morning, US stock index futures are down between 0.4% and 0.5%. In case Wall Street’s main indexes open deep in negative territory, the dollar should be able to continue to gather strength and not allow GBP/USD to stage a rebound.

Reuters reported on Monday that 30 of 51 economists that took part in a recently conducted survey expect the Bank of England (BOE) to hike the policy rate by 50 basis points at its September meeting. This headline failed to help the British pound find demand. Meanwhile, the Telegraph reported over the weekend that BOE Governor Bailey would be open to reviewing the bank’s mandate. 

In the American session, the Federal Reserve Bank of New York will publish the findings of the Empire State Manufacturing Survey. The NAHB Housing Index will also be looked upon for fresh catalysts. Unless these data trigger a risk rally, the USD could continue to capitalize on safe-haven flows. The US Dollar Index was last seen rising 0.25% on the day, reflecting the broad dollar strength.

GBP/USD Technical Analysis

GBP/USD is now trading below the 50-period and the 100-period SMAs on the four-hour chart and the Relative Strength Index (RSI) indicator is pushing lower toward 40. Both of these technical developments confirm the lack of buyers’ interest in the British pound.

As of writing, the pair was testing 1.2100 (Fibonacci 38.2% retracement of the latest uptrend). In case this level is confirmed as resistance, the next bearish targets could be seen at 1.2050 (Fibonacci 50% retracement, 200-period SMA) and 1.2000 (psychological level).

On the upside, 1.2120 (100-period SMA) aligns as immediate resistance before 1.2140 (50-period SMA) and 1.2175 (Fibonacci 23.6% retracement, 20-period SMA). 

Gold: A break lower 1770 is a sell signal [Video]

– Gold Spot holding first support at 1790/85.

– Silver longs at first support at 2030/10 with a low for the day exactly here & a bounce to 2086.

– WTI Crude unfortunately did not quite reach strong resistance at 9550/9600 before prices turned lower.

– Remember when support is broken it usually acts as resistance & vice-versa.

Today’s analysis

Gold first support at 1788/85 holding the downside on Thursday & Friday. Best support at 1780/75 today. Longs need stops below 1770. A break lower is a sell signal targeting 1765 & 1760.

We could have strong resistance at 1804/08. A break above 1813 however targets 1828/31.

Silver longs at strong support at 2030/10 hit my targets of 2060 & 2080, with a high for the day here. Above 2090 this week look for strong resistance at 2140/60. Shorts need stops above 2180. A break higher is a buy signal targeting 2190 & 2240.

Strong support at 2030/10 of course, but longs need stops below 2000. A break lower is a sell signal targeting 1980 & 1950.

WTI Crude September meets very strong resistance at 9550/9600. Shorts need stops above 9700.

Shorts at 9550/9600 target 9300/9250. On further losses look for 9050/9000 before a retest of 8750/8700. A break below 8700 can target 8550/00.

EUR/USD deeper pullback short trading setup

(Nenad Kerkez – Top-XE)

EUR/USD technical analysis

• Move down from MH3.
• I have a short position.
• Bearish trend continues.
• 6 point bearish move.

MEGATREND MAs: Neutral

D1 Chart EUR/USD

1. Swing high
2. Order block
3. Lower high
4. Lower low
5. Order block retest
6. Potential target

EUR/USD is moving down. We have witnessed a deeper pullback to the long side. In my Telegram group we could see great positions from both long and short trades in the last 2 weeks. Now I am shorting it as the price is showing double top at M H3 resistance. It’s also a retest of the order block. We should see a move and continuation down below the trend line which might be broken soon. Look for 1.0171 as the intraday target and possibly 1.00781 if the price continues lower.

The ECB policy diverges from the FED policy. So, in that case I expect more EUR weakness generally. In the example above, technicals are still generally very bearish and the deeper pullback is a part of the EUR/USD bearish trend. So, the price should go down and only if it breaks MH3 1.0371 the trend might change, and we could start buying the dips.

Read The Chinese central bank unexpectedly eases monetary policy