Even though large movements lacked on the final day of the first quarter, which was by the way the best quarter in a year for the U.S. dollar, traders were able to profit on the long side in both GBP/USD and DAX.
U.S. President Joe Biden laid out a $2.25 trillion infrastructure plan that will be funded with higher corporate taxes. The administration said that tax increases would “fully pay for” the plan, with corporate income tax rising to 28 percent from 21 percent. What Biden laid out yesterday is just the first part of his long-term economic program, with a second part to be announced in mid-April. According to an administration official, Biden’s plan will create millions and millions of jobs which would bode well for the U.S. dollar over the next years.
GBP/USD: The cable tested the 1.38-handle but refrained from a bullish breakout – at least until this morning. In case of a break above 1.3815 we expect the pair to head for a test of its resistance at 1.3840-50. Below 1.3750 however, we anticipate lower targets around 1.3720.
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