Unexpectedly shoot up in the last 12 hours, before the weekly candle closed GBP/USD bounces off 1.6250, all the way to 1.6450, 200 pips range.
I cannot explain the price action; basically it is due to fundamentals, as well as the technical resistance on Dollar Index.
Devaluation of the USD... Debt Crisis, Debt Limit, Curb Expenditures...
If you have been reading, we at Ayumi the Novice Trader mentioned the following for GBP/USD:
“Unless market break above 1.6468, I will be hunting for short.”
Market moved up, and formed a high of 1.6469.
Which means, I will sit back, and expect GBP/USD to continue going up to 1.6550 regions = May 31 high...
Expect good support at 1.6300 if GBP/USD were to trade down on Monday.
Short: Stay out until 1.6550 regions.
Long: intraday trade long near support, target 1.6550 region, or close EOD.
EUR/USD
EUR/USD has moved up as per forecast, but, my long entry gets triggered when EUR/USD made a new low before it rally.
The chart look weird with a lower low, and higher high, which indirectly means EUR/USD is trading into a widening range.
Support 1.4340 - 1.4280.
Weekly Chart: Indecisive. Resistance 1.4530. Support 1.4230.
Intraday view: Consolidation bias bullish.
No trade, stay out.
Dollar Index
What we like about it….
Hit Resistance on 4 Hour chart, and a quick correction.
As long as Dollar Index do not trade below 73.50 region, the consolidation shall last for the beginning of the week (another 4-6 bars in 4 Hour Chart), any fundamental news that trigger dollar index above 74.60 will lead all the way… up. :)
1st resistance 75.00
2nd resistance 76.00, Target.
If Dollar Index traded below 73.50, then expect dollar to dive down to May 2011 low near 72.80 region.
Chart tells everything..
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