GBP/USD Risks Larger Rebound as RSI Threatens Bearish Momentum

Talking Points:

- Larger GBP/USD Rebound Favored on Bullish RSI Break

- AUD/USD Clears 0.93330-40 Resistance Ahead of RBA Policy Meeting

- USDOLLAR RSI Falls Back From Overbought, Threatens Bullish Momentum

For more updates, sign up for David's e-mail distribution list.

GBP/USD

• Relative Strength Index (RSI) appears to be breaking out of bearish trend as GBP/USD climbs to a fresh weekly high of 1.6604.
• Need a close above 1.6600-10 (61.8% retracement) for confirmation/conviction for a larger rebound.
• Nevertheless, the DailyFX Speculative Sentiment Index (SSI) continues to show that retail crowd remains net-long on GBP/USD as the ratio stands at +1.57.

AUD/USD

• Will look at the broader AUD/USD range as the pair climbs back above former support around 0.9330-40 as the RSI appears to be breaking out of the bearish momentum.
• Reserve Bank of Australia (RBA) is widely expected to keep the benchmark interest rate at 2.50%; will Governor Glenn Stevens toughen the verbal intervention.
• Next key topside target comes in around 0.9380 (38.2% retracement) to 0.9390 (38.2% retracement) should we see a close above former support.

Join DailyFX on Demand for Real-Time SSI Updates Across the Majors!

Read More:

Price & Time: In Search of A Low in the Euro Next Week

Sharp CAD Reversal Negates USD/CAD Bull Flag, Stuns EUR/CAD, GBP/CAD

USDOLLAR

Chart - Created Using FXCM Marketscope 2.0

USDOLLAR(Ticker: USDollar):

• Seems like the Dow Jones-FXCM U.S. Dollar Index has marked a near-term top at former support; bearish break on RSI to provide confirmation/conviction for larger decline as the oscillator comes off of resistance.
• Still want to see the USDOLLAR fill the weekly opening gap on a close-basis; will look for a higher-low given recent series.
• Former resistance around 10,555 (50.0% retracement) to 10,561 (100% expansion) in focus amid the risk for a more meaningful USDOLLAR correction.

Join DailyFX on Demand for Real-Time SSI Updates!

Click Here for the DailyFX Calendar

--- Written by David Song, Currency Analyst

To contact David, e-mail [email protected]. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

Trade Alongsidethe DailyFX Team on DailyFX on Demand

Looking to use the DailyFX Trade Signals LIVE? Check out Mirror Trader.

New to FX? Watch this Video

Join us to discuss the outlook for the major currencies on the DailyFXForums