GBP: Bears running out of bullets

The price action yesterday in early European trade was very informative in my opinion and suggested to me that the bears have finally run out of momentum. I’m bearish on the USD anyway in the medium term, and I feel that the GBP is way oversold on the crosses, even against the rampant JPY.

Any dips back under 1.4200 are definite buy-dips opportunities in my biased view.

If you prefer to play on the crosses, I think GBP/NZD is worth a long look (pardon the pun). I don’t think it will take much to knock NZD/USD back to mid-range levels on the dailies, perhaps towards the 200-sma which is sitting around .6600. The GBP/NZD cross is trying to form a base around 2.06 and looks ripe for a retracement towards 2.15.

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