Last week the euro reversed the prior week’s strength, looking headed for lower prices in the days ahead. GBP/USD is set up to make good on a key-reversal week and trade lower as well. Gold had been stuck into a historically small trading range until Thursday when it finally started to move into open space, looking for more weakness, but higher lower always a possibility.
- EUR/USD failed breakout has short-term focus on 11500
- GBP/USD weekly reversals to put pressure on next week
- Gold price range breakdown has focus lower at the moment
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EUR/USD failed breakout has short-term focus on 11500
Since breaking out a week ago Thursday, EUR/USD has since stalled and failed back well beneath the breakout zone in the low 11700s. This has it also below the trend-line off the August low. Price is back amid the chop dating back to May, but the euro looks poised to continue lower for a test of the area just above 11500.
EUR/USD Daily Chart (Support near 11500 next)
For a longer-term perspective, check out the Quarterly Euro Report
GBP/USD weekly reversals to put pressure on next week
GBP/USD posted a key-reversal bar last week, which as we discussed in yesterday’s webinar regarding key-reversals, primed it for strength to fail this week. Barring a major move higher during the remainder of the session, a second reversal bar in a row will be posted. This should have pressure on next week towards the trend-line off the August low around 12960.
GBP/USD Weekly Chart (Reversals)
GBP/USD 4-hr Chart (T-line eyed as next target)
For a longer-term perspective, check out the Quarterly Pound Report
Gold price range breakdown has focus lower at the moment
As we discussed earlier this morning, gold finally broke down out of the range it had been stuck in. Next week we will look for more follow-through as long as the 1187/90 area isn’t recaptured. Next up as support levels are 1174 (spike-day close) and 1160 (spike-day low). A break below the lows would have gold likely reeling towards the December 2016 lows near 1120. It’s possible a higher low is posted ahead of the August lows, but we’ll let price action dictate that and run with what is in front of us now – a range-break.
Gold Daily Chart (Range resolving lower)
For a longer-term perspective, check out the Quarterly Gold Report
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX