Not much has happened in the market on Wednesday and trading can be described as very quiet. Market-moving economic data was still lacking and thus the price action in both major currency pairs was constricted to tight trading ranges. The technical picture has therefore not changed.
While none of our daily entries was triggered in the EUR/USD, the cable showed a slight upward trend towards 1.2550. The 1.2550-barrier is considered an important resistance and if the pound rises above that level we may see a continuation of the recent upward trend, driving sterling towards 1.26 and possibly even 1.2660. On the bottom side we will pay attention to a potential break of 1.2440. Lower targets could be at 1.2420 and 1.2320.
Bank of England Governor Mark Carney is scheduled to speak in London today at 18:30 UTC. This speech might be worth watching given accelerating inflation and recent hawkish comments. If Carney highlights a hawkish outlook despite the risks surrounding the U.K.’s exit from the EU, the pound could extend its gains. If he however, takes a neutral stance on monetary policy, sterling could fall back towards 1.24.
The euro traded between 1.0715 and 1.0640. As long as there is no fresh price breakout above or below this range, there is nothing new to report.
From the U.S. we have Continuing and Initial Jobless Claims scheduled for release at 13:30 UTC but these reports are of secondary importance to the greenback.
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