With Theresa Mary May, the UK Home Secretary, heading to fade the political uncertainty in Britain after the present PM, David Cameron, announced his resignation during post-Brexit disappointment, the GBP surged again all of its counterparts. The GBPUSD, not being an exception, also bounced from 1.2850 and rallied to the highest in more than a week; however, short-term descending trend-line resistance, at 1.3330, might restrict its further upside and can trigger the pair’s renewed decline. At present, the Brexit-day lows around 1.3230 can provide adjacent support to the pair, breaking which 1.3110 and the 1.3050, followed by the 1.3000 psychological magnet, are likely consecutive supports that it could witness. Given the pair further dips below 1.3000, it becomes weaker enough to revisit the 61.8% FE of its June 24 crash, around 1.2850, and the 1.2800 support. Alternatively, a clear break above 1.3330 can quickly fuel the pair towards 1.3400 and the 1.3480-85 horizontal resistance-line, which if broken alleviate chances of its further run-up to 1.3650, comprising 23.6% Fibo level.
Even if the EURGBP reversed from 0.8290-95 horizontal support, 61.8% Fibonacci Retracement of its latest up-move, around 0.8365, near to the 0.8385 trend-line, might limit the pair’s further upside. Should the pair clears the 0.8385, the 0.8400 and the 50% Fibo level around 0.8420 may entertain the short-term Bulls, breaking which 0.8450 and the 38.2% Fibo level of 0.8470 can act as small barriers during its rise to 0.8490 – 0.8500 horizontal area. On the downside, 0.8320 and the 0.8295-90 might restrict the pair’s nearby decline, clearing which 0.8260 and the 0.8230 are likely consecutive supports to see on the chart. Moreover, pair’s further weakness below 0.8230 needs to confront with the crucial 0.8200 mark prior to expecting revisit of 0.8000 psychological magnet.
Alike GBPUSD, the GBPJPY also struggles to clear the horizontal resistance-area, around 139.40-60; however, the overbought RSI indicates fair chances of the pair’s pullback towards 137.00 immediate support. If the pair drops further below 137.00, 23.6% Fibonacci Retracement level at 136.00 and the 133.00 can come-back on the chart. Meanwhile, pair’s capacity to clear the 139.60 can activate its up-move to 38.2% Fibo level of 140.60 and then to 143.50. If the pair successfully trades above 143.50, it becomes capable enough to aim for 147.00 resistance level.
While 100% FE of the GBPCHF’s November 2015 – April 2016 downside helped the pair’s bounce, a downward slanting RSI, coupled with inability to clear the 1.3200 mark favors the Bears’ return. Given the pair closes below 1.3030, it can quickly test the 1.2900 and the 1.2840 supports while its further decline below 1.2840 needs to confront with 1.2720 and the 1.2600 in order to re-test the 100% FE level around 1.2460. However, pair’s ability to surpass the 1.3200 can further support it to counter the 61.8% FE level of 1.3285, breaking which April month lows of 1.3415 and the trend-line support-turned-resistance of 1.3550 are likely numbers to observe for the pair traders.
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