By Talking Points:
- Sterling dives as data comes in weak in spades.
- Swiss Franc strengthens in wake of ECB.
- US Dollar holding steady ahead of the December NFPs.
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Intraday Price Perspective
A scan of this morning’s best and worst performers via the Strong/Weak app ahead of the December US labor market report shows that the British Pound and New Zealand Dollar – two of the strongest currencies in the second half of 2013 – are falling fast. We turn our focus to the GBPUSD, as the European currency bloc has been the leadership ground over the past few months. Today’s NFP report could dictate whether or not a top is developing.
TECHNICAL ANALYSIS – CHART OF THE DAY
GBPUSD D1 Chart: June 2013 to Present
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- The GBPUSD remains in an uptrend off of the July and November lows, although failure near $1.6500 this week may have seen a lower high (relative to late-December) established.
- Price has lost support of the uptrend off of the November and December lows.
- Daily Slow Stochastics (5,3,3) have been diverging from price of late, with a series of lower highs developing. This may be a sign of a market nearing an inflection point.
GBPUSD H1 Chart: June 2013 to Present
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- A look at the short-term timeframe (H1) shows that the slight ascending channel that contained price since Monday has broken lower, through 1.6440.
- Price has fallen through the entire moving average envelope; watch the H1 8-EMA intraday as a guide for short-term price action.
- Price has started to base near 1.6400, a swing low on January 8 intraday.
- Before selling accelerates, a daily close <1.6330/60 will be required. This represents the ascending TL off of the July and November lows. It would also mark a new low for the month.
Read more: January seasonality suggests a weaker GBPUSD
EURO-ZONE ECONOMIC CALENDAR
There are no data on the Euro-Zone economic calendar for Friday, January 10, 2014.
UK ECONOMIC CALENDAR
SWISS ECONOMIC CALENDAR
--- Written by Christopher Vecchio, Currency Analyst
To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com
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