FOREX NEWS: RETRACEMENTS UNDERWAY, BULLS STILL IN CHARGE
EUR/USD
Forex News: The European Final CPI came out with the expected value and did not have a major impact on the Euro. The pair climbed above 1.0710 and is now re-testing the level from above.
Technical Outlook
If 1.0710 level will turn into support, thus rejecting the pair higher, the chances of a move into 1.0775, followed by 1.0800 will increase. The Relative Strength Index is coming down after visiting the overbought zone, so the current bearish retracement may extend into 1.0680 where a bullish bounce will have a higher probability of happening. Our bias is bullish, expecting a break of yesterday’s high.
Fundamental Outlook
At 12:30 pm GMT the Philly Fed Manufacturing Index comes out, showing the opinions of about 250 manufacturers from the Philadelphia district regarding the general level of business conditions. It acts as a leading indicator of economic health, with a medium impact. Usually, numbers above the forecast 25.6, strengthen the US Dollar.
GBP/USD
Fuelled by the snap election call, the Pound’s gains extended way past 1.2770 resistance and into 1.2855 where it finally paused. Yesterday’s trading session slowed down but the climb will likely continue.
Technical Outlook
Price didn’t stop at 1.2770 and pierced through 1.2855, creating a high at 1.2905 before retracing below the previous level. It seems that 1.2855 is still resistance because we can clearly see several candles that touch the level but remain below it. So, we are dealing with strong resistance and an extremely overbought Relative Strength Index, facts that make us anticipate a move lower before bullish momentum will resume.
Fundamental Outlook
Bank of England Governor Carney will speak at 3:30 pm GMT at the Institute of International Finance Policy Summit and an hour later he will participate in a panel discussion at an event organized by the Bank of France. Pound volatility may surge during these events, so we recommend caution.