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Technical Update - EURUSD sell-off accelerating. GBPUSD testing key support. Dollar Index towards +105
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
Summary: EURUSD selling accelerating, could drop to 1.07-1.05
GBPUSD testing key support but looks heavy and could soon slide lower to around 1.23
Dollar Index uptrend is eyeing strong resistance at 105.80
EURUSD paused for a moment at minor support at 1.0765 before selling has continued. RSI back below 40, EURUSD is set for a move towards 1.07 possibly dipping down to around 1.0635 before one should expect a rebound.
Weekly chart showing EURUSD is breaking bearish out of rising channel. The 55 weekly Moving Average will provide some support but there is no strong support until around 1.05
To demolish this bearish picture a close above 1.0950 is needed
GBPUSD downtrend is continuing. Now testing support at around 1.2550.
RSI is showing negative sentiment strongly indicating lower GBPUSD levels.
There is not strong support until around 1.23 but the 200 daily Moving Average currently at 1.2421, will provide some support so expect a rebound from there.
Weekly chart – medium-term trend still bullish but could very well be reversing. After breaking below lower rising trend line in what seems like a rising wedge pattern GBPUSD could be for increased selling pressure.
Key support at around 1.23 is likely to be tested in coming weeks. Key question is whether weekly RSI will break below 40 threshold or bounce off The Dollar Index has resumed uptrend taking out August peak. Dollar Index is set for a move to strong resistance at around 105.80
RSI is showing positive sentiment and the 55 Moving Average is rising, and could soon break above the 200 Moving Average thus forming a Gold Cross further underlining the bullish scenario.
To reverse this bullish picture a close below 102.85 is needed.
RSI is testing the 60 threshold, a close above will further confirm the uptrend that could take the4 Index above 105.80. But 105.80 is a key strong resistance
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