Daily Insights Report 31/05/17

• 31 May 2017

GBP/JPY

The GBP/JPY pair has retraced back from a significant uptrend which began at the beginning of April. However, a bullish crossover of the 50-day moving average over the 100-day moving average indicates that the current bearish trend may not continue in the longer term. Price action appears to have found support at the 50 Fibo level (not shown). Momentum indicators suggest that near-term momentum remains bearish, therefore price action may need to reach the 61.8 Fibo level for greater probability of a bullish reversal.

SILVER

Similarly, a bearish cross-over can also be seen in the precious metal, Silver. Price action has reached and bounced back from moving averages. A doji candlestick marked the end of the previous uptrend as buyers began to lose steam. A break of the 50 resistance line with a downward trajectory on RSI further suggests bearish momentum. MACD remains negative, though is heading towards the zero line.

EUR/GBP

The Euro appears to be gaining favour over the Pound ahead of the British election on 8^th June. The EUR/GBP pair appears to be in a marked uptrend and momentum indicators suggest this trend will continue. The pair has broken the 20-day exponential moving average indicating near-term bias is positive. A bullish crossover on MACD and the emergence of the indicator above the zero line, suggest the uptrend will continue. RSI has an upward trajectory and is yet to reach overbought territory.

Impact event: Eurozone Inflation data is due to be released at 12:00 GMT+3.

CHF/JPY

The CHF/JPY pair appears to have found resistance at the 20-day EMA. A spinning top candlestick indicates indecision in the market. MACD signals bearish momentum, with a bearish crossover and the histogram dropping below the zero line. RSI is relatively flat but has had lower lows and lower highs on the move to its current position. A break of the 20-day EMA will confirm the bearish trend.