Welcome to a new trading week which could have some larger market moves in store as the U.S. Federal Reserve and ECB are set to announce policies this week.
As for the Fed which meets on June 13-14, officials are expected to take a breather and skip a rate hike this month after more than a year of increases. However, Fed Chair Jerome Powell could signal that policy makers are prepared to keep hiking if needed. Some market participants expect the Fed decision this month to be a close call, especially if Tuesday’s U.S. inflation print should come in higher than expected.
On Thursday the European Central Bank is widely expected to raise rates by 25bps again.
Taking a look at the technical picture, the British pound showed decent gains against the U.S. dollar, closing the past week on a positive footing.
We will keep tabs on a breakout price range between 1.2650 and 1.24. Breaking above 1.2670 will increase chances in favor of a bullish breakout towards 1.30. However, we bear in mind that the pair entered overbought territory, making corrections towards 1.2450 likely.
The pair consolidated within its recent price range between 1.08 and 1.06. Until there is no breakout of this range, there is nothing new to report.
Breakout in the making?
The index’s price movement narrowed, increasing the chances for a profitable breakout. Above 16020, we favor a bullish bias with a higher target at 16200. Below 15900, however, we will pencil in a lower target at around 15700.
Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.
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