Technical Update - GBPUSD testing key pivot at 1.14. EURGBP bouncing from supports
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
GBPUSD is once again testing long term pivot around 1.14. Seems like it has trouble breaking above.
EURGBP is set to rebound from supports and has 0.90 in sight
GBPUSD is touching the Pivot at around 1.14 as mentioned in earlier analysis: https://www.home.saxo/content/articles/forex/ta-gbpusd-multi-decade-cycles-30092022
If GBPUSD breaks above 1.15 there is room up to around 1.1738. However, 55 SMA is coming down indicating underlying sentiment is declining and RSI is still below 60 threshold and must close above to reverse that. . GBPUSD slides back and RSI drops back below 40 last week’s lows at around 1.0922 is likely to be tested but lower levels are quite likely to be seen .
EURGBP is bouncing off 100 SMA around 0.8571 support, now back above 55 SMA. RSI has bounced off its 40 Threshold and sentiment is still positive indicating EURGBP could rebound further from here. If EURGBP breaks above the steep falling trendline minor resistance at 0.8867 is likely to be tested.
First sign of this scenario to play out is likely to be RSI breaking above its falling trendline. Keep an eye on that to occur.
If EURGBP on the other hand, breaks below 0.8570 and RSI closes below 40 it is likely to reverse the scenario and EURGBP to drop further to 0.8450-0.8350.
Latest Market Insights
Q4 Outlook 2022: Winter is coming
- Winter is coming to the financial markets as central banks are tightening their grip. How spring will look is still a question.
European energy crisis: it will get worse before it gets betterThe winter in Europe will be tough, but whether the result is political chaos or sustainable, innovative solutions is still undecided.
A difficult and volatile quarter awaitsAs the year draws to an end, commodities continue to be at centre stage of the world with growth pockets political uncertainty.
The bright side: crises drive innovationThe positive spin on crises is that they come with solutions. It is worrisome that deglobalisation may be a response to this crisis.
Green transformation in China: renewable energy and beyondGoing green, China needs to span numerous energy sources to ensure stability, as every source comes with a challenge.
Asia: Intermittent solutions, but a faster renewable adoption curveAsian energy supply is being squeezed. This and the adoption of renewables may change the investment sentiment in the region.
FX: A Fed thaw needed to deliver a sustained USD turn lowerThe US Dollar can keep momentum when the Federal Reserve continues to tighten, leaving the rest to play to their drum.
Autumn can become ugly for equities and bond holders. Comfort for Dollar longsTechnical analysis suggests that equities could face a tough Q4 as could fixed income. US Dollar positions could provide some upside.
The next stock market sector to watch, with stocks going nuclearAs the world scrambles to find affordable, sustainable energy, nuclear is getting attention from politicians and investors alike.
The crypto space is getting cold when the hype disappearsCryptocurrencies face a winter of their own as retail investors and governments are asking tough questions.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)