Forex Marketz Daily Forex News – Fully Markets Update
The GBP/USD forex market has been on a nice bounce back. The Sterling has recovered most of its losses after forming a bullish engulfing candlestick.
Technical Analysis:
My technical analysis for today notes a couple of interesting factors. First up not the flattening of the RSI indicator. This hints at ebbing bullish momentum. Right now there is near term resistance lining up at 1.5795. A daily close above this level will challenge the technical resistance at 1.5940. This level is just below the key pivot at 1.60. The alternative analysis, if the Sterling pushes lower bringing the GBP/USD down, notes technical support at a former resistance level. This level is at 1.5648. A close below this support challenges the technical support at 1.5465.
Trade Strategy
There is no big event risk, aside from Greece to effect any of the Eurozone currencies, which there are two. The GBP and euro. As I mentioned yesterday, Greece will affect all Forex markets so one should pay close attention to what is going on with their debt payback negotiations. From a technical perspective, price action is trading right up against a technical resistance level. This argues against a long GBP trade, from a risk to reward perspective, at this time. I am, as mentioned above, noting a flattening RSI indicator. This could hint of ebbing bullish momentum warning against a long Sterling trade. There are also no clearly defined bearish reversal signals to warrant a short GBP (long USD) trade. For now, I am opting to stand aside and wait for a better trade opportunity to come along.