FOREX NEWS: US DOLLAR LOSES GROUND, STRUGGLES TO REGAIN CONTROL
EUR/USD
Forex News: The pair moved higher yesterday, showing that the market interpreted the FOMC Minutes as dovish and that most traders now have a slightly bullish bias.
Technical Outlook
The current move up is a retracement for the overall downtrend so we expect the pair to continue its movement south once the pullback is complete. The 50 period Exponential Moving Average is the first barrier in front of rising price but both the Relative Strength Index and the Stochastic are showing bullish momentum so we may see a move into 1.0790 before the bearish movement can resume.
Fundamental Outlook
There are no major economic releases today but ECB President Mario Draghi will deliver a speech at the Euro Finance Week in Frankfurt. The scheduled time is 8:00 am GMT and his attitude could very well decide the euro direction for the entire day, especially if he will talk about ECB’s monetary policy.
GBP/USD
The British Retail Sales showed a disappointing value of -0.6% (forecast -0.4%) and the Pound weakened but only briefly and soon after the bulls regained control of the pair.
Technical Outlook
The resistance at 1.5250 was broken and then successfully re-tested from above so we can assume we are dealing with a true break and probably moves higher will be next. Short term support sits now at 1.5250, followed by the 50 period Exponential Moving Average which is starting to curve upwards. The first bullish target is represented by 1.5330 and we expect retracements lower once it is touched, mostly because both oscillators will probably be oversold at the time.
Fundamental Outlook
The British Public Sector Net Borrowing is released at 9:30 am GMT and is the only notable indicator of the day but the impact is often overlooked. The expected value is 5.5B (previous 8.6B) and usually, lower numbers are beneficial for the currency.
We hope you had a profitable trading week and we wish you a relaxing weekend.