09 Nov

Intraday Market Analysis – GBP Seeks Support

November 9, 2021

By Orbex

EURGBP sees a temporary pullback

EURGBP

The sterling inched higher as traders took profit after the BOE’s dovish shift last week. The rally above the supply area of 0.8570 is a sign of commitment from the buy-side.

Strong momentum has forced the bears to rush for the exit door. 0.8620 is now the next resistance. Its break would bring the euro to September’s high at 0.8660, where a breakout may lead to a bullish reversal in the medium-term.

In the meantime, an overbought RSI is causing a pullback. The base of the latest surge at 0.8465 is an important support.

NZDUSD tests key resistance

NZDUSD

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The New Zealand dollar recoups losses as risk appetite recovers. The pair has met buying interest at 0.7070 along the 20-day moving average.

A bullish RSI divergence is a sign that the bearish momentum has waned. When this happens in a demand zone, it makes a rebound of greater significance.

0.7180 is a major hurdle ahead following a previously botched bounce. Its breach may resume the kiwi’s uptrend above 0.7220. The RSI’s double top in the overbought area may briefly limit the bullish impetus.

GER 40 consolidates gains

DE40

The Dax 40 continues to rally in hopes of a prolonged low-rate environment.

The bulls are pushing towards 16200 after the index reached the milestone at 16000. However, the RSI’s multiple ventures into the overbought area and a bearish divergence indicate that the rally may have overextended.

A temporary pullback would be necessary to let the bulls catch their breath. 15920 is the immediate support. Further down, 15730 on the 20-day moving average would be an area of interest.

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