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Midweek Report 3rd January

VIBHS Financial

Gold
The Bulls have performed very well during the Christmas period and into the New Year. There were several positive signs during the build-up, having already established a pattern of higher-highs and higher-lows (arrowed on the chart) and, on 20th December, closing well above the 1238 Fibonacci level. On that day, Gold posted a high of 1266 which was the first resistance area created back in July however, the pullback was brief before fresh buying saw Gold push on again and early trading today sees this market trading circa 1286. This was an old support that gave way in June 2018 and could prove to be a difficult area, having now switched to the resistance column. It should also be noted that The Relative Strength Index has now entered overbought territory however as yet, there are no recognised reversal signals.

Currencies
With the New Year starting, EURGBP will remain in focus as Brexit remains high on the political agenda. On Friday 7th December, this pair posted a close above the .8939 resistance level (arrowed on the chart). This sparked aggressive buying and the following Monday saw prices reach a high of .9087. This was just short of a major resistance level at .9098 created at the end of August 2018. There followed competition between the Bulls and the Bears, with the market swinging back and forth on a number of occasions. On 31st December, the Bears moved this market to a low of .8927, below .8939 which had switched to the support column. Although marginally breached, the reaction and subsequent bounce means that this support remains relevant therefore, the key levels are .8939 and .9098.

VIBHS Financial Review

Source: https://www.vibhsfinancial.co.uk/vibhs_news/currency-update-03-jan-2019-fx-cfds-news-daily-chart-cable-gbp-usd-january-gold-jpy-currencies-vibhs-2019-majors-brexit.cfm
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