Top three charts of the week: GBPUSD, US500, SILVER

Summary:

• GBPUSD bounces off the support area at 1.2100

• US500 tries to recover after recent declines

• Silver reaches YTD highs

The pound rebounds from key technical support

The British pound has found itself under pressure recently. However, looking at the W1 interval, one can see that bulls managed to defend the key support at 1.2100. The upward movement observed last week was triggered by remarks made by the European politicians on Brexit. The German Chancellor Angela Merkel said that she could find an alternative to the backstop issue in the near future. GBP surged on the news.. Meanwhile, Boris Johnson continues to label Brexit the most important challenge for the government at the moment and keeps reiterating that he will do whatever it takes to make it happen. Looking at the GBPUSD chart from a technical point of view, the pair may extend the upward move to as high as the 1.2400 handle, where the key resistance level is located. However, the upward move we are observing right now is just a correction. A break above the 1.2400 handle could herald bigger upward move. It should also be noted that each subsequent test of the support level at 1.21 increases the likelihood of breaking lower. In such a scenario, the way towards 1,1800 handle, where is the 161,8% Fibo level can be found, would be left  open.

Source: xStation5

US500 with a chance to retest the market geometry

In spite of an attempted recovery, weekly candlestick for the previous week closed near weekly low.. Another escalation in the Sino-US trade conflict was the prime reason behind index weakness Beginning of a new week brought a kind of relief as the two sides seemed to have hit a softer tone on trade.. Looking at the chart from a technical point of view, the situation barely changed. Should the positive moods persist, the upward move could be extended in the second part of the week. The key resistance zone is localized in the vicinity of the 2950 handle and unless a break higher occurs, the index may continue to trade sideways. On the other side of the range, one can find the support at the 2800 handle, that is marked with the 1:1 system. Nevertheless, even a break lower does not have to lead to a larger sell-off, as the support zone marked with the 38.2% Fibo level and the lows from 3rd March and 2nd June can be found slightly below it. 

Source: xStation5

Silver breaks above the 50% Fibonacci retracement

Growing trade tensions caused gold and silver prices to move higher. Silver managed to break above the 50% Fibonacci retracement of a large downward move started in mid-2016. Now the precious metal may move towards the next one resistance level that is marked with 61.8% Fibo level -$18.40 handle. A break back below the $17.45 handle could invalidate the bullish scenario but as long as the price stays above it - buyers seem to have an advantage.

Source: xStation5