The 2.0000 mark proving to be tough support in the GBP/USD

Recapping the Majors

EUR/USD- The Euro floated slightly higher today around 3650 after it made a nice clean break of 3600 yesterday. It was overall a slow moving day but the Euro has been hanging around that 3650 mark and looks to be at a standstill once again.

Result: The Euro made a slight gain against the Dollar and pushed up to 3650 where it is currently hanging around.

GBP/USD- The Cable started the day with a small rally up to the 2.0050 mark but was unable to sustain it and ended up falling right back down near the 2.0000 level. The pair has had trouble breaking the 2.0000 support and today was another example of the indecision the market has been showing for this currency pair.

Result: The Sterling showed signs of a rally but ended up falling right back down near the 2.0000 area.

USD/CHF- After a hard drop yesterday, the Dollar was able to rally back and bounce up after hitting the 2000 level. The pair continued to move as high as 2057 before settling back down around 2040. Today’s price action strengthens the support level at 2000.

Result: After falling hard yesterday, the Dollar rallied back and bounced up from the 2000 level to around 2050.

USD/JPY- It was the same old story for the Yen as it once again stayed put at just above the 118.50 level. The pair has been making small pushes below the 118.50 level but by the end of the day, the pair continues to move back above it and settle at around 118.60-118.70.

Result: The Yen stayed put……………..again!

Chart Analysis: What’s going to happen next?

EUR/USD

Well I said the Euro may float to around 3650 and thats exactly what it did today. Both the 4hr and daily stochastics are now in overbought territory which is a strong indication that the pair is most likely headed down in the near future. Look for the Euro to drop back down to 3600 and possibly to its 50 EMA on the 4hr chart which is currently at around 3573.

GBP/USD

The Sterling rose a little bit early on in the day but ended up falling right back down near the 2.0000 mark for the 5th straight day. The 2.0000 has proven to be a critical support area. 4hr and Daily stochastics are trending down so my bias on the pair is still bearish. If the pair can break 2.0000, look for it to head down to 1.9950 or even 1.9900.

USD/CHF

Yesterday I talked about the significance of the 2000 level and how it was a critical support area. Today, that level proved itself to really be a critical support area as the pair bounced up after briefly falling below it and headed up to around 2050. 4hr stochastics are trending up and have just left oversold territory so we could see the pair continue to head up. Daily stochastics are trending down but it has been criss-crossing so its not really easy to gauge a direction using them. My short term bias is bullish and I think we will see the Swissy head up to its 50 EMA on the 4hr chart which is currently around 2077.

USD/JPY

Zzzzzzz! This pair is putting me to sleep. Once again we saw the Yen drift aimlessly as it consolidated once again and stayed just above 118.50. I don’t expect the Yen to stay this quiet for long so I am still anticipating a breakout. Remember, the 100 and 200 SMA have formed an upper and lower bound for the range and if the pair breaks out on either end, I would expect it to continue in that direction.

  • pinetree

    The only reason the GBP did a little rally I believe was because of the lower number New Home Sales report that came out that had the effect of weakening the US dollar. So it was really an artificial rally and hence the GBP continued its downward motion after its little peak. The GBP seems to be pounding (no pun intended) on the 2.0000 support. It is only a matter of time that it breaks through. I sure hope I am not sleeping when that happens.

  • pinetree

    The only reason the GBP did a little rally I believe was because of the lower number New Home Sales report that came out that had the effect of weakening the US dollar. So it was really an artificial rally and hence the GBP continued its downward motion after its little peak. The GBP seems to be pounding (no pun intended) on the 2.0000 support. It is only a matter of time that it breaks through. I sure hope I am not sleeping when that happens.

  • citratorrio

    thx 4 the advice mr. Pippo….i get 138 pips….hihihi i`m a green lover ;)

  • citratorrio

    thx 4 the advice mr. Pippo….i get 138 pips….hihihi i`m a green lover ;)