Technical Analysis 7/6/2017
By Antonis Vasloos
EUR/USD: 1.13 Remains Elusive
Europe’s common currency remains in a firm uptrend supported by strong technical indicators, despite recent failures to overtake the 1.13 level. The EUR/USD has added more than 400 pips since 10 May, when the latest uptrend began. Prices settled near daily highs on Tuesday after running into overbought territory earlier on. Based on the 1-hour Bollinger Band formation, the euro is likely to be considered overbought near 1.1290.
GBP/USD: Cable Eyeing Breakthrough at 1.29
Traders’ risk tolerance for cable remains quite low despite the recent poor performance of the US dollar. The GBP/USD spiked on Tuesday before the bulls faded from view, which sent prices into consolidation near 1.29. A break below 1.29 would send prices back toward the 1.2850 support area on route to the 50-day simple moving average (SMA) below 1.28. On the opposite side of the ledge, immediate resistance at Tuesday’s high of 1.2950. The Money Flow Index suggests growing buying interest in cable.
WTI Oil: Rebound Vulnerable as Prices Run Into Resistance
Oil rebounded sharply on Tuesday, but the outlook remains vulnerable after prices maxed out near $48.50 a barrel. That’s roughly the high from 2 June before prices resumed their descent. West Texas Intermediate (WTI) is seeing favourable momentum, based on a reading of the Relative Strength Index (RSI). Price action is also accelerating, with the 50-day moving average crossing above the 200-day SMA.
Gold Prices: Bullion Approaches $1,300
A weaker dollar combined with growing risk aversion to send gold prices soaring on Tuesday. Bullion maxed out above $1,294.00 a troy ounce, putting it on track for fresh eight-month highs. However, price action is running into resistance at the April high. A failure to extend the rally beyond this level could expose the yellow metal to a double-top, which would send prices in the opposite direction.