The upward trend on the GBP/USD and EUR/USD, which took its beginnings from the middle of April, is starting to show signs of weakness. The GBP/USD rate has fallen from its maximum of 1.5813 to 1.5715. The euro/dollar rate fell from 1.1444 to 1.1345. The pairs fell by 100 points from their last maximums but you can’t call that a turnaround.
For the eurobulls to give in, the 1.1270 level needs to be broken. The pound needs to fall lower than 1.5512. As soon as buyers of the euro lose their foothold and the above mentioned level is broken, growth for the dollar will hasten throughout the market.
Together with the euro and the pound, gold has also cheapened. The yellow metal has also seen a fixing of profit after the 2 month maximum of 1227 was reached. The XAU/USD rate has dropped by 15 dollars to 1211.
At 16:15 EET the USA is publishing data on manufacturing values. At 17:00 EET some preliminary May CPI data from the University of Michigan will come out.
Since the pound/dollar has immediately dropped down to 1.5708, it’s worth considering a new target of 1.5650. From the euro/dollar I’m waiting for a drop to 1.1320/15.