Welcome to a new trading week.
Last week ended with a trend reversal in many currency pairs as market participants rushed to reprice the U.S. dollar’s low price level following the big nonfarm payrolls number. The NFP report last Friday came in as a big surprise with 517k new jobs last month. This rosy labor market data forced the market to curb its push against the Federal Reserve’s credibility, pushing the greenback higher.
The dust settled after last week’s high impact data releases and given the quiet economic outlook this week, we may see some follow through of the fresh trends.
EUR/USD – Entering the support area
After the euro has tested the upper ascending trendline at 1.1030, euro bulls were not able to hold that high level and fell victim to a fresh round of dollar strength. It will now be interesting whether the support area between 1.08 and 1.07 holds. From here we may see another bullish attempt to push to the euro back towards 1.09. However, given the reversal’s strength we prepare for further losses and keep tabs on a potential break below 1.07.
GBP/USD – Double-top pattern following the price cap at 1.2450?
For the double-top pattern to be played out we would need to see a significant break below 1.1840 and further 1.1750. A lower target could then be at around 1.15.
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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.