Chart of the Day GBPUSD
GBPUSD Potential Reversal Zone - Probable Price Path
There are still signs of deterioration in the US epidemic. Some pharmaceutical companies claim that their production of drugs can help reduce the death rate of coronaviruses, and the market's risk-taking intentions have rebounded slightly. The US dollar index erased up to nearly 0.3% of gains last Friday, closing slightly down to 96.7, down 0.5% on a weekly basis. The 10-year U.S. Treasury yield once fell to a new low of 0.57% in two and a half months, and closed down by 3 basis points to 0.64% The cumulative number of coronavirus infections in the United States exceeded 3.27 million. Among them, Florida has more than 15,000 new cases, setting the largest single-day record for all states
GBP: The outlook for the UK economy has improved, and investors continue to watch the UK epidemic situation and the development of trade negotiations with the EU. A British government spokesman reiterated that there are still major differences between the EU and the UK on trade agreements. UK and EU representatives will meet in Basel this week, and a new round of negotiations will be held next week
USD: In June, the US producer price index fell by 0.8% year-on-year, which was larger than market expectations. The United States will release the June Consumer Price Index and retail sales data this week, and the market expects the two data to continue to improve. The Federal Reserve will release a new regional economic report on Wednesday. US President Trump said that Sino-US relations have been severely damaged, and the second-phase trade agreement is currently not being considered. The Chinese Ministry of Foreign Affairs said it would take countermeasures against U.S. sanctions against Xinjiang officials. The Wall Street Journal quoted sources as reporting that the US government is concerned that if major sanctions are imposed on the Hong Kong financial system, it may also damage the US and Western countries
From a technical and trading perspective, GBPUSD continues to test descending trendline in the 1.2650/70 area, we have witnessed two daily rejections leaving long tale candles a third rejection and close below the near term volume weighted average price sighted at 1.2590 should be sufficient to prompt another test of the ascending trendline support towards 1.24. From here watch from bullish reversal patterns as an opportunity to deploy bullish exposure for an eventual test and breach of the pivotal 1.28. A closing breach of 1.24 would suggest further price discovery to the downside targeting a test of range support to 1.2250, before another basing attempt may develop.
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Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!