Technical Outlook:
- GBP/USD trading above June high towards long-term trend-lines
- Silver price action smacks of exhaustion as it touches long-term resistance
The GBP/USD chart continues to shape up well for longs as Cable presses on to its highest levels since March. It surpassed the important June high yesterday at 12813, which puts it in position to keep on rallying towards a pair of long-term trend-lines and peaks from earlier in the year prior to the coronavirus collapse. The trend-lines run lower from 2014 and 2018 in roughly the same vicinity, 13080 up to 13180, where those swing highs are. If GBP/USD is to undergo some weakness and/or consolidation period here then it is ideal it stays above the June high of 12813.
GBP/USD Daily Chart (above June high)
Silver is showing signs of exhaustion after its spectacular run. The extraordinary volatility to the tune of a double-digit intra-day range following such a large move indicates that we have likely hit a key inflection point. At best it appears it will lead to a consolidation pattern and likely a decline of some sort for the foreseeable future. The high came at a trio of lows created during 2011 and 2012 when gold and silver were undergoing the topping process. This further validates the idea that we will see silver weaken soon. There might be an attempt to run back towards the 26.20 high, but it will likely act as only a retest and result into a leg lower. Stay tuned as silver volatility is set to stay elevated for the foreseeable future.
Silver Daily Chart (showing signs of exhaustion at 2011/12 levels)
Silver Price Chart by TradingView
For all the charts we looked at, check out the video above…
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
