FOREX NEWS: EURO GETS A BOOST FROM THE FRENCH PRESIDENTIAL ELECTION RESULTS
Forex News: The week opened with a huge upside gap of almost 150 pips, generated by the French Presidential Election. The pair is now sitting above several levels, which were previously resistance.
The gap took price to a high of 1.0890 but afterwards the pair started to range and the bullish advance stopped. Usually, gaps are closed, meaning that price will eventually return to the point where the gap originated but the time it takes for price to move there is unknown. We could very well see a push into the high at 1.0905 but it’s more likely to get another ranging trading session; for now, caution is recommended, until the pair chooses a clear direction.
The U.S. Consumer Confidence survey will be today’s only notable release, scheduled at 2:00 pm GMT and expected to show a value of 123.7, which is a drop from the previous 125.6. The survey is derived from the opinions of about 5,000 households regarding economic and business conditions; this large sample is what makes it important, generating US Dollar strength if the actual reading surpasses analysts’ expectations.
Yesterday the pair wasn’t much affected by the French Election and instead remained confined in a relatively tight range, with low volatility.
As long as the pair remains confined inside the channel created by 1.2770 support and 1.2855 resistance, we consider it in a range and we have a neutral directional bias. From a longer term perspective the pair is in an uptrend and we expect a continuation but if 1.2770 support is broken, we will most likely see a touch of the 50 period Exponential Moving Average.
The Pound will not be affected by any major economic releases, so the pair’s direction will be determined by the technical aspect and by the U.S. Consumer Confidence survey.