Gold is still undergoing a bearish correction. Buyers should not be worried as it is nothing dangerous; we are still trading within the upward channel formation above major long-term supports. We’l most likely get a decline towards the lower line of the upwards channel, or maybe a bit deeper – to the horizontal support at 1,315 USD/oz. As long as we stay above the 1,307 USD/oz, the sentiment is very positive.
Next up is the EURGBP pair, which is dropping sharply. This was anticipated by us in yesterday’s analysis. The reason for this is the major downtrend and subsequent bullish correction, which ended on the 38.2% by drawing a double top formation. Friday’s candlestick is a nice shooting star, which tested the recent support as the closest resistance. This test was positive for the bears, which brings us a major sell signal.
The last instrument is USDCAD, where we are in an upwards channel formation. Most recently, the price bounced from the lower line of this pattern, which is a good start. For a proper buy signal, we have to see a breakout of the neckline of the inverse head and shoulders formation. For this, we still have around 100 pips to go, so stay sharp!