EURUSD:
The EUR has been consolidating below the 50 day moving average, after breaking below it, 2 weeks ago. It seemed unable to sustain a close above 1.27 and it could not close above it’s 100 day MA as well. However, Yesterday’s price action finally lifted the EUR across its 100 day MA as it closed right at the 50 MA. If the EUR can follow yesterday’s price action with another win, especially above 1.29 then the EUR will look to extend it’s gains over the short term. However, if the EUR falls back below the 100 MA, then a bearish EUR sentiment will remain intact.
GBPUSD:
The GBP after holding firm against the Greenback is finally starting to show some underlying weakness. After initially finding support at the 50 day moving average, Tuesday’ price action took out that level only to be completely reversed back yesterday. However, Wednesday’s price action could not muster a clean close above the 200 day MA on the way back higher. Bulls would want to see a close back above 1.5650 while bears would take a close below 1.5300 as a signal the GBP rally may be coming to a halt.
EURGBP:
While both the EUR and GBP are in search of another clean close higher against the USD, it is always interesting to look at the cross to see which currency is trading stronger. The EUR, after trading lower since mid July, is finally starting to break north again. Tuesday’s price action pushed the EUR above trend line Resistance and it was followed by yesterday’s close higher to the 50 day moving average. If the EUR closes above the 100 day MA , currently near an 84 handle then the EUR may rally hard against the GBP, especially if the GBP fails to break north against the USD. However, if the the 50 day moving average holds firm Resistance then the EUR may fall back into trend line support and resistance as it will trade lower.
Written by bforex.com
