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Price Signal Summary - GBPUSD Pullback Appears To Be A Correction

  • In FX, the trend outlook in EURUSD remains bullish, however, the pair started the week on a softer note as it extends the pullback from 1.1017 the Nov 17 high. The move down appears to be a correction. Note that the trend condition is overbought and the pullback is allowing this to unwind. Support to watch is 1.0774, the 50-day EMA. A clear break would be bearish. A resumption of gains would refocus attention on the 1.1065 objective, the Aug 10 high.
  • The trend direction in GBPUSD remains up and this week’s move lower is considered corrective. Recent gains maintain the current positive price sequence of higher highs and higher lows and note that moving average studies are in a bull-mode position, highlighting an uptrend. A return higher would refocus attention on 1.2800, the Aug 22 high and 1.2868, a vol band resistance. Initial firm support to watch is at 1.2525, the 20-day EMA.
  • USDJPY maintains a softer tone. The pair traded lower last week and breached 147.15, the Nov 21 low. The move down highlights a resumption of the bear cycle that started Nov 13. Attention is on a key support at 147.05, a trendline drawn from the Mar 24 low. This line was breached Monday. A clear break would signal a stronger reversal and open 145.91, the Sep 11 low. Key short-term resistance to watch is 148.51, the Nov 30 high.

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