The worst performer yesterday was the British pound which broke below 1.38 and extended its slide towards 1.3720. While the pound’s recent slide can be attributed to profit-taking and the subsequent drop below crucial technical barriers, traders should bear in mind that the pound’s overall upward trend is still intact. If GBP/USD remains above 1.37, we anticipate a rebound towards 1.3850. However, if the March low at 1.3670 breaks, chances are in favor of further bearish momentum with a next lower target at 1.36.
The euro, on the other side, rebounded against the U.S. dollar and tested the 1.1920-resistance area. Bulls will now wait for a renewed break above 1.19 in order to anticipate further gains. If bulls are unable to push the euro above 1.19, the focus shifts to the 1.1860-50-area and a break below that short-term support could lead to further losses towards 1.18. Breaking further below 1.1780, the euro could resume its downward trend towards 1.16.
The DAX found a short-term support at the 100-Day EMA (15160) from where it gained ground and finally ended the day above 15200. Let’s see what the market has to offer today.
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