The best performer was the British pound which climbed towards 1.43 and provided sterling bulls a good profit. As already assumed in yesterday’s analysis the odds seemed to be in favour of an upswing although there were no fundamental drivers supporting the bullish bias. Speculations about higher inflation could have been a possible reason for the pound’s recent price rice. Inflation accelerated to 0.4 percent annually in March from 0.3 percent in February, forecasts show. U.K. Consumer Price Indices are scheduled for release today at 8:30 GMT and if data are in line with expectations, sterling could begin to give up its gains as a slight uptick has already priced in. Traders should bear in mind that the outlook for the pound remains fragile as long as uncertainty dominates the currency ahead of the EU referendum in June. However, given the recent upward movement the cable may also extend its gains towards 1.4325 and 1.4365, provided GBP is able to break through the 1.43-barrier. On the bottom side we expect the 1.4175-level to lend a short-term support for the currency pair.
All quiet in the EUR/USD. This has been the motto for euro traders as the euro’s sideways movement provides nothing but losses. The current resistance at 1.1450 proved to be intact while the 1.1372 prevented prices from falling. Amidst the sideways trend, breakout traders searched in vain for any profitable trading chances and struggled with false breakouts. However, we know that a sideways trend with fluctuations confined to a narrow band usually does not last very long. We are therefore looking for upcoming breakouts of that narrow trading range.
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