GBP/USD: Next Bearish Target At 1.4455?
Dear Traders,
Yesterday’s trading was dominated by a counter-movement in both major currency pairs. The euro trended downwards, moving away from its resistance at 1.0940, but the slide came to a halt at nearly 1.0840. For the time being, we expect the euro to trade within its current 100-pip trading range between 1.0935 and 1.0840. A break above 1.0945 may push the common currency for a rise towards 1.0980. However, with no important economic data releases from the eurozone, gains in the EUR/USD could be capped at 1.10 and 1.1050. On the bottom side, we expect a next support at 1.08, provided that the euro breaks below 1.0840.
Traders should listen to comments of Federal Reserve Presidents this week. Fed’s Vice Chair Fischer speaks in Paris today at 10:30 GMT.
The British pound recovered from the 1.45-support and tested the next important price level at 1.46. In the end, the upward turned out to be short-lived and sterling gave up its gains. Today could be a busy day for sterling traders, with Industrial Production figures due at 9:30 GMT and BoE Governor Mark Carney scheduled to speak in Paris at 14:15 GMT. Investors are pessimistic with regard to a first BoE rate increase. Even though a weakening pound comes handy to the economy and inflation, BoE policymakers are unlikely to feel any pressure following the Fed in raising rates.
GBP/USD
While the trend is clear, it will hinge on economic data and BoE speak whether GBP could be vulnerable to further losses. We see a next possible halt at 1.4460/50, from where GBP may bounce back in a first attempt. On the other side, upwards moves could be limited until 1.4630 and 1.4665.
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