Technical Analyst, Saxo Bank
GBPUSD has bounced strongly following the heavy selling in September breaking above its upper falling medium-term trendline to the 0.382 Fibonacci retracement at around 1.1814. Resistance at 1.19 could be tested, however.
If closing above 1.19 there could be more upside to around 1.2250-1.23.
For GBPUSD to reverse this uptrend a close below 1.1144 is needed. A close below 1.1340 would indicate that scenario to unfold.
EURGBP bounced off support at 0.8565 and seems to be warming up for uptrend to resume. A close above 0.8866 will confirm that. First indication of this scenario to unfold would be if EURGBP breaks above 0.8830.
If that scenario unfold EURGBP is set to move to around 0.90.
Medium-term EURGBP is in an uptrend supporting the view of correction that has taken place over the past couple of months is over. Weekly RSI showing positive sentiment and no divergence indicating higher level on EURGBP
A close below 0.8560 is needed to reverse that.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.