GBP/USD – sterling/dollar falling lower from resistance
The GBP/USD has basically been confined within a larger trading range for most of this year. The trading range support is down near 1.4000 and the resistance is up near 1.4730. In the chart below, you can see a strong level of resistance at the upper boundary of the range, near the 1.4730 area. Notice that this level has contained price recently and on two recent occasions price has collapsed after testing this resistance so it’s clearly a key level to pay attention to the upside. Friday’s large daily price bar shows a significant upper tail which suggests that prices experienced selling pressure during the session, and that is a potential bearish warning headed into this week. Given these chart dynamics, we see downside risk in the GBP/USD this week and whilst under 1.4730. Traders can look for price action sell signals on the 4 hour or daily chart to consider selling opportunities this week. The chart shows downside targets around the 1.4000 – 1.4050 area. A convincing daily close above 1.4730 would void our bearish bias.
AUD/USD – Aussie/dollar retraces higher, but downtrend still intact
The AUD/USD has been in a downtrend over the last month and we still see that trend as being intact despite last week’s surge higher. The AUD/USD chart remains contained under the major resistance at 0.7490, and this week might present a selling opportunity if price can push into overhead resistance and provide a price action sell signal. There is minor resistance around the 0.7370-90 area that is worth noting, and major resistance is seen at 0.7490, as mentioned. If price manages to push higher this week, traders can look for sell signals on the 1 hour, 4 hour and daily charts to confirm an entry. More advanced traders may consider a blind sell entry (an entry without a price action signal) at 0.7490.
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S&P500 – S&P500 remains buoyant as uptrend continues
The S&P500 is still in a long-term uptrend as we have been discussing for months now in our commentaries. Recently, we have been looking to buy short-term weakness or pullbacks down near 2070.00 support. Notice the bullish tails on last week’s bars, this indicates bulls are still in control and keeping prices buoyant. We are once again looking to buy this week and whilst price is above the key support down at 2030.00 we retain a bullish (upward) bias. Traders can look for buying opportunities to or just above 2076.00 – 2070.00 support with an upside target of 2130.00 or potentially even higher.
This article was written by Nial Fuller. Nial is a highly regarded professional trader and author. He is the founder of Learn To Trade The Market, the worlds foremost trading education resource. To learn more, visit www.LearnToTradeTheMarket.com