Daily Market Report – GBP/USD Monstrous Decline To Come? August 23, 2017

GBP/USD Hovers Above Critical Support

Price is still heavy on the Daily chart and seems poised to hit new lows on the Daily chart. Has changed little in he morning as the USDX is undecided as well. Has managed to drop below a major dynamic support and is approaching a crucial static support, a valid breakdown will open the door for more declines in the upcoming weeks.

Technically is somehow expected to drop further, but the rate will be driven by the fundamental factors in the upcoming days. We have to be very careful during the Jackson Hole Symposium because we may have a high volatility.

GBP/USD dropped through the upper median line (UML) of the major descending pitchfork and now is almost to hit the 1.2798 static support. A valid breakdown below this downside obstacle will attract more sellers, which will lead the price towards fresh new lows.

Price is very heavy after the failure to stabilize above the upper median line (UML) of the major descending pitchfork. Is very important to see what will happen on the USDX as well, which is located right above the 93.50 psychological level, but is trapped below a dynamic resistance.

GBP/USD is somehow expected to drop at least till will reach the second warning line (wl2) of the minor ascending pitchfork. Could reach this level, even if will stay above the UML and above the 1.2798 static support.

GOLD Consolidates The Lates Gains

The yellow metal continues to move in range on the Daily chart, only a valid breakout will bring us a clear direction. Is trapped within the 23.6% and the 50% retracement level, you can see that we had a false breakout above the 23.6% and above the $1295 per ounce on Friday, signaling an exhaustion.

Now is retesting the long term 38.2% retracement level, will increase further if the support will hold, while a breakdown will signal a drop at least till the WL1.

USD/CHF Gaining Pace

Price is trading in the green and looks determined to take out the dynamic resistance from the median line (ml). Technically should increase further after the failure to close on the WL2. A valid breakout will send the rate towards the 0.9787 static resistance and towards the 250% and the upper median line (uml). We have an important confluence area formed at the intersection between the 250% line and the upper median line (uml), which could attract the price.

By Olimpiu Tuns

Market Analyst

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