June 26 , 2018
By looking at the daily chart we can see that the pair has shown buying interest but that was limited as pair is still hovering below the moving average lines. We can observe that after a steep downfall some profit booking was expected due to dollar weakness. Overall short term to intermediate term trend is down so in a downtrend market sell on high will be profitable strategy.
Bears are still taking the charge and the way bears are reacting it seems like they are still showing their presence in the pair and will dominate the bulls. A correction after a downfall is a healthy sign for trend formation. The blood bath is going on and there is no chance for buyer to have any position.
A valid breakout of 1.3110 level which is a key support level will open the way towards the 1.3020 level in short term. Traders and investors are advised to have short position on the pair as long as 1.3465 level remains intact and we will keep our bias as bearish on the pair as long as mentioned level remains intact as odds are in favor of bears.
The Pound upward potential was limited by Brexit jitters ahead of the EU Summit that will take place by the end of the week. Concerns that the UK won’t offer a convincing offer to make progress toward the final divorce, undermine demand for Sterling. the calendar will become a bit more lively with the release of May BBA Mortgage Approvals and the CBI survey on realized sales for June.
A bearish crossover on MACD indicator is favoring the bears and providing us bearish signal for the time being. On contrary RSI arrived in the oversold zone which indicates a bid bounce back from the bull’s side, well there is nothing to be worried that bounce should be considered as fresh sell position. . The 1.3450 level is immediate resistance level followed by 1.3550 whereas 1.3010 level is strong key support level followed by 1.2950 level.
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