GBPUSD probes for support
Cable moved higher as April’s unemployment rate fell more than expected. A break above 1.2800 has further put the bears on the defensive. On the chart, the pound is still in a downtrend, meaning that the correction is still probing for support. The Cable trend is important to watch, 1.2860 over the 20-day SMA is the next stop to see if buyers will return. Otherwise, 1.2650 would be a critical floor. A bullish RSI divergence is an encouraging sign suggesting that the sell-off has lost some momentum.
USDCAD attempts to rebound
The Canadian dollar continues to claw back losses after moving towards the 1.3700 level. After a tentative consolidation, a bounce off 1.3720 is a sign that buyers are trying to hold on. A retest and a breach of the significant obstacle of 1.3780 would flush out some sellers and extend the rally to 1.3900, potentially opening the door to a broader recovery. A fall below said critical support would invalidate the rebound and send the pair towards 1.3640.
GER 40 bouncing higher
The Dax continues its bullish stance after bouncing at the recent double bottom. A close above the previous swing high of 17500 could have put the index back on track. This suggests that overall sentiment has remained upbeat despite a temporary downswing. 18500 at the previous peak might be the last resistance level, and a bullish breakout would pave the way for a fresh high. On the downside, 17100 at the lower end of the latest consolidation is a key support to keep the rebound momentum going.