Welcome to this week’s Market Blast Technicals.
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I’m Brad Alexander and on behalf of Valutrades, today we will look at GBPUSD, and at Gold (XAUUSD).
USD has been getting stronger this week, and in many cases, against the trend so we need to be careful here.
As we trade Gold against the USD, we see dollar strength and higher US Bond yields pushing price action down but geopolitical tensions and purchasing by central banks pushing price action up.
This has created consolidation in XAUUSD and we will keep an eye on our trend lines and the Stochastic Oscillator which is moving down from Overbought on the Daily chart.
Also, looking at our Fibonacci retracements from the uptrend, which started at the bottom of this double bottom from last March, to the peak in May of last year, we see price action ranging between the 61.8% level and the 38.2% level.
Both of these were good support and resistance levels and they were hard to break sometimes.
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We are watching GBPUSD as price action is trying to break this lower trend line with the stronger USD and some turmoil in the UK government.
If we zoom out to the Daily chart, we see a different picture with a long downtrend, price action has just bounced off the upper trend line, and the stochastic oscillator is moving lower.
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