Daily Insights Report 14/07/2017

• 14 Jul 2017

GBP/USD

The British pound appears to be gaining momentum over major peers with a rally in the last week. Positive employment data from the U.K. yesterday contributed to the bullish sentiment in the pound. Having broken a support level at 1.286, the pair has rallied passed the 20-period exponential moving average and is now testing the 1.296 resistance level.  MACD supports bullish momentum and has turned more positive in the last few bars. RSI has a sharp upward trajectory but is still some way from overbought territory. The direction of the pair will be determined by whether price action is able to break above the 1.296 level.

Impact event: Consumer prices and spending data at 15:30 GMT+3 could impact all dollar pairs.

EUR/GBP

The positive sentiment for the pound has also carried through to the EUR/GBP pair as Sterling has rallied significantly in the last few days.  Price action has broken below the 0.884 previous resistance level and continued the bearish move to also break the 20-period EMA. The next price target for sellers will be the 0.877 price level. RSI has a sharp downward trajectory. MACD suggests that there is still some residual bullish momentum, however the indicator is lagging.

Impact event: European Trade Balance data at 12:00 GMT+3 may impact euro pairs.

GOLD

The descending trend-line continues to act as a resistance level for the metal as once again, price action bounced back off of the 1222.23 resistance level and trend-line.  MACD has moved further into negative territory indicating that the trend is likely to remain bearish for some time. RSI has paused flat just above the 30 support level as Gold remains oversold.  A break of the trend line would be required to signal a bullish reversal.

AUD/USD

The Aussie Dollar will finish the week strong gaining significant ground over the U.S. Dollar during the week’s trading. The pair has seen five consecutive trading days dominated by buyers breaking through consecutive support levels at 0.760 and 0.768. MACD remains positive and Bollinger bands give no indication that the asset is overbought, as the indicator has widened with price action rising. It will be interesting to see of the pair can make it to 7 straight bullish candles. RSI has reached and paused at the overbought 70 zone. However, given the trajectory of the 20-period EMA, Bollinger bands and price action the signal on RSI appears not to be significant.