The GBPCAD pair is holding just under 1.80000 after testing the level yesterday. The high at 1.80922 from the 9th of April takes on an important significance, as a move above this level would create a higher high and confirm a resumption of the move higher. The current retracement reached a low of 1.78080 last week, and this is forming the base that price has built from. A move higher would target the 1.82646 area, with the previous high at 1.84148. A break above here would target 1.85000, followed by 1.86254 in extension.
Support below the current price comes from last week’s low, followed by trend line support at 1.77936. A loss of this level would see price fall towards the dual supports at 1.76614 and 1.76382. The 100 DMA is located at 1.75965, with the rising red trend line at 1.75758, and this whole area is strongly supportive. Only a loss of this area would hand control over to bearish traders, by forcing longs to close, who would look to target the 200 DMA at 1.73117. A successful move under here could see the 1.70000 level tested.
USDJPY
The USDJPY pair is painting a bullish picture and has tested the breakout at 107.000, which was supported by the 100 and 200-period MAs. A sustained move higher would target the recent high at 107.773, followed by the 107.917 level and the 108.000 area. Further resistance is found at 108.277 and 108.885, with 109.000 close by.
Support comes from the 107.000 area, with 106.712 providing support, before the red descending trend line at 106.450. A move below this area would target 106.000, followed by 105.500. The lows from late March come in at 104.573 and a visit of this area could provide the opportunity for a double bottom to form. However, if this level is breached, 104.000 may be retested, with 103.600 below, and, ultimately a move down to parity could be on the cards.
