By Forex Signs, Inc.
At today’s trading session, the GBPUSD pair kicked off at 1.5518 price level. Just after one candlestick at H1 chart, it had a bearish breakdown by 30 pips. Then another candlestick reversed the breakdown by 31 pips. After the fast-tracked turnaround, the pair consolidated at 15 pips higher. Resistance is measured at 1.5889 while support is at 1.5473. The latter was just quantified at the previous session as it had broken the 2-week support by 50 pips. During yesterday’s trade, the GBPUSD made some dramatic movements as it consolidated at 13 candlesticks in H1 chart then it suddenly collapsed into a bearish momentum. It tried to go back but only reached 38.2 percent Fibonacci retracement of the breakout. Meanwhile, the Alligator indicator seems to pursue a downtrend as it opened its mouth after the sudden collapse yesterday. However, at H1 chart today, the lips and the teeth are gradually becoming closer and that can possibly lead to making the alligator fall asleep. A snoozing alligator means no trend; volatility must not be set high as chances are it can have a reversal. In the interim, %R (14) is approaching the neutral level. At the time of writing, the indicator is valued at -36.55. Anyhow, despite slight hesitations of a bearish trend, it is still suggested to sell the pair as the Greenback is getting its strength from reports of them having a strong economy.
American Session Outlook
In the previous trading session, the US dollar had a series of bullish breakouts against its European currency pairs. The trade started in favor of the rival legal tender then after 8-12 candlesticks at H1 chart, the trend had a bullish reversal. This intense U-turn may have been brought about the EU Economic Summit that occurred that day. At the summit, it was highlighted that EU banks face an extra £80bn of bad debts. As expected, investors turned out to their currency haven. At the end of the trading session, the Greenback augmented 42, 110, 60 pips against Swissie, Sterling, and Fiber respectively.
For today’s session, the US dollar may expect another bullish sentiment as conjectures say that the Treasury Currency Report will be released today. Previous statement by the Department of Treasury discussed about their decision to stop short of branding China a currency manipulator. With that, the USD trade against Asian currencies had a minor bullish breakout. For the awaited statement, traders are expecting that the Treasury Department will speak about the tax cuts. The tax cuts are foreseen to spur the US economy. This agreement spearheaded by President Barack Obama is probably to oppose forecast that 2010 deficit is nearly at 10 percent of GDP. Deficit may be slightly lower than last year but it suggests that the economy will take more time to recover. Anyhow, if Treasury Currency report will be released today, chances are the Greenback will sky-rocket again.
About the Author
Forex Signs, Inc., Founded in 2006 in Wall Street, New York City, FSI relentlessly strives to be the premier Forex brokerage company in the industry by providing exclusive and unmatched trading and investment related services while constantly developing innovative solutions that cater to the vast requirements of both individual and institutional market participants.
