GBP/CHF – British pound bulls retreated further as GBP/CHF continued to trade within a trading range that dominated the price action since 2005. As Swiss Franc longs remain in charge of the price action, a move to the downside will most likely see the cross head lower and with a move below 2.2700, a level defended by the 38.2 Fib of the 2.1714-2.3310 GBP rally and is further reinforced by the 50-day SMA target 2.2512, a level 38.2 Fib of the 2.1714-2.3310 GBP rally. A sustained momentum on the part of the Swissie longs will most likely see GBP/CHF head below the psychologically important 2.2500 handle and target pound bids around 2.2323, a level protected by the 61.8 Fib of the 2.1714-2.3310 GBP rally. A further move to the downside will most likely see the cross gain further downside momentum and target the psychologically important 2.2000 handle, a level defended by the 78.6 Fib of the 2.1714-2.3310 GBP rally at 2.2055. Indicators are mixed with negative momentum indicator diverging from positive MACD above the zero line, while oversold Stochastic gives pound bulls a chance to retaliate.
GBP/AUD – Pound longs remained narrow trading range as the cross stalled around psychologically important 2.3500 handle, a level defended by the combination of 20-day, 50-day and 200-day SMA’s. As Australian dollar bulls push GBP/AUD lower, a further move to the downside will most likely see the cross target sterling bids around 2.3384, a level established by the 23.6 Fib of the 2.5672-2.2692 AUD rally, which currently acts as a gateway toward the psychologically important 2.3000 handle, a level defended by the December 6 daily low. A further break to the downside will most likely see the cross head lower and target the cable defenses around 2.2679, a level established by the 2005 Low, breaking of which will most likely see the cross accelerate toward the next psychologically important 2.2500 handle. Indicators are favoring sterling longs, with both positive momentum indicator and positive MACD treading above the zero line, while neutral oscillators give either side enough room to maneuver.
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