The Pound Struggles To Gain Dominance Over Peers

• 16 Oct 2017

GBP/USD

The GBP/USD pair has retraced from a previous downtrend breaking both the 20-period EMA and the 1.322 price level. The pair has also hit the 38.2 Fibo level and the current session has a doji candle marking a period of uncertainty for the pair. MACD has a sharp downward trajectory and is approaching the zero line whilst RSI has flattened just above the 50 support level. The retracement may be short-lived.

GBP/CAD

The GBP/CAD pair has broken the 20-period EMA to the upside, however, the break was followed by significant selling pressure. Price action appears to be approaching the 1.66 price level and a break of this previous resistance level will provide weight to the uptrend. Momentum indicators are mixed however, with MACD indicating bearish sentiment and RSI showing a clear upward trajectory. Fundamental factors may be required to push price action in either direction.

Impact event: Bank of Canada Business Outlook report will be released at 17:30 and may impact Canadian dollar pairs.

GBP/JPY

The GBP/JPY pair has retraced from a previous bearish move to test the 20-period EMA and the 23.6 Fibo level. MACD has a marked downward trajectory yet RSI has flattened just above the 50 support level. Perhaps fundamental factors will facilitate a breakout.

EUR/GBP

The EUR/GBP pair has broken both a previous resistance level at the 0.892 price level and the 20-period EMA whilst also testing the 0.887 price level. MACD however, indicates that sentiment is turning more bullish as the indicator approaches the zero line. At the same time, RSI is heading towards the 30 support level, with the question being: is a bullish reversal imminent or will sellers push the Euro lower? A break of the 0.887 price line to the downside would confirm a bearish bias.