Sterling Likely to Struggle, Here's Why?

In the G10 FX Market, USD and JPY are the top gainers today while EUR and CHF are the top losers, down -0.41% and -0.37% versus the dollar, respectively. The dollar was looking to finish a strong week where we saw tumbling oil prices and panic-stricken markets.

Sterling fell once again on concerns that the UK may be slower to react in terms of opening back lockdown. The UK Government's Chief medical adviser Chris Whitty suggested that some form of social distancing measure could be in place for the rest of the year. Opinion polls have shown that public mood is in favour of a hard lockdown and current level of testing is also very abysmal. All these factors are likely to contribute to a slower recovery in Britain compared to the rest of the developed world and this may weigh on the Pound over the coming weeks.

In the rates market, global yields were trading weaker with the US 10-year yield down -0.7bp trading at 0.596 and the German 10-year yield trading lower by -2.4bp around -0.461. In the Asian Session, Equities markets were trading weaker with S&P 500 futures down -0.18% at 2775.88, the Nikkei down -0.83% at 19267.5, and the Hang Seng down -0.46% at 23868.0 In the energy space, the Brent front month is trading up 0.98% for the day at $21.54.

10-year Yields Daily Chart (1-month)

Daily FX Pivots

(Content and Data by Tradermade)

Forex Chart and Technical Analysis

EURUSD Chart (Two-week)

Strategy: Resistance at 1.079 for 1.0755
Short-term view: EUR/USD resistance comes in at 1.0793 MACD and RSI have a bearish bias. Hence, we see a dip to 1.0703 enter at 1.0763. Above 1.0793 to open 1.0831

GBPUSD Chart (Two-week)

Strategy: Support at 1.2298 for 1.2357
Short-term view: GBP/USD support comes in at 1.2298 MACD and RSI have a bullish bias. Hence, we see bounce to 1.2357 enter at 1.2317. Below 1.2298 to open 1.2249

USDJPY Chart (Two-week)

Strategy: Resistance at 108.0 for 107.3
Short-term view: USD/JPY resistance comes in at 108.0 MACD and RSI have a bearish bias. Hence, we see a dip to 107.3 enter at 107.77. Above 108.0 to open 108.37

AUDUSD Chart (Two-week)

Strategy: Support at 0.63 for 0.6424
Short-term view: AUDUSD support comes in at 0.63 MACD and RSI have a bullish bias. Hence, we see bounce to 0.6424 enter at 0.6341. Below 0.63 to open 0.623