While the U.S. dollar became recently an unloved investment, other major currencies benefitted from global growth and the weakening dollar. Thus, both major currency pairs EUR/USD and GBP/USD experienced strong uptrends, climbing towards fresh highs. Many market participants now wonder, whether there will be a follow through and extension of gains or whether there could be sharp corrections following a series of new highs. While traders should generally follow the primary trend, it is important to focus on technical barriers and previous resistance and support zones to evaluate the prospects of profitable movements. Let’s take a quick look at the technical picture in our chart analysis below.
Furthermore, there need to be catalysts on a fundamental basis to spur momentum to the respective direction. This week could be characterized by the search of a catalyst spurring further bullish momentum or leading to corrections.
We have the Federal Reserve’s FOMC statement on Wednesday but this month’s meeting could prove a nonevent as there is no press conference while no changes are expected. The market will look for hawkish hints suggesting the Fed will prepare for three, perhaps even four, rate hikes this year. Today we have the Fed’s favored inflation gauge, the PCE deflator scheduled for release at 13:30 UTC. This reading could have an impact on the dollar ahead of Friday’s Nonfarm payrolls report.
From the Eurozone, we have the 4Q GDP report (Tuesday), the region’s inflation and labor market data (Wednesday) scheduled for release this week.
As for the pound sterling, traders will listen to BoE Governor Carney, who will speak before the U.K. Parliament in London Tuesday. On the same day, U.S. President Trump will deliver his first State of the Union address.
In summary, it could be a volatile trading week even though the chances are currently in favor of consolidative movements, rather than major breakouts.
EUR/USD
The euro failed to hold above 1.25, which is why we saw some pullback towards the current support zone around 1.2360. We will now keep an eye on the 1.2350-1.23-area which could act as a near-term support zone. If the single currency is, however, able to climb back above 1.25, we expect further gains towards 1.26 and 1.2650.
GBP/USD
The British pound corrected some of its gains and dropped back towards 1.41. Sterling bears should pay attention to price breakouts below 1.4080 which could lead to further losses towards 1.40 and 1.3950. If the pound climbs back above 1.42, bulls could regain control, driving the cable towards 1.4270 and possibly even 1.44.
We wish you a good start to the new week and many profitable trades!
Here are our daily signal alerts:
Daily Forex Signals:
We are currently short in GBPUSD and this trade has already proven successful.
View our daily signal alerts http://www.maimar.co/category/daily-signals/
www.maimar.co
Furthermore, there need to be catalysts on a fundamental basis to spur momentum to the respective direction. This week could be characterized by the search of a catalyst spurring further bullish momentum or leading to corrections.
We have the Federal Reserve’s FOMC statement on Wednesday but this month’s meeting could prove a nonevent as there is no press conference while no changes are expected. The market will look for hawkish hints suggesting the Fed will prepare for three, perhaps even four, rate hikes this year. Today we have the Fed’s favored inflation gauge, the PCE deflator scheduled for release at 13:30 UTC. This reading could have an impact on the dollar ahead of Friday’s Nonfarm payrolls report.
From the Eurozone, we have the 4Q GDP report (Tuesday), the region’s inflation and labor market data (Wednesday) scheduled for release this week.
As for the pound sterling, traders will listen to BoE Governor Carney, who will speak before the U.K. Parliament in London Tuesday. On the same day, U.S. President Trump will deliver his first State of the Union address.
In summary, it could be a volatile trading week even though the chances are currently in favor of consolidative movements, rather than major breakouts.
EUR/USD
The euro failed to hold above 1.25, which is why we saw some pullback towards the current support zone around 1.2360. We will now keep an eye on the 1.2350-1.23-area which could act as a near-term support zone. If the single currency is, however, able to climb back above 1.25, we expect further gains towards 1.26 and 1.2650.
Attached Image
GBP/USD
The British pound corrected some of its gains and dropped back towards 1.41. Sterling bears should pay attention to price breakouts below 1.4080 which could lead to further losses towards 1.40 and 1.3950. If the pound climbs back above 1.42, bulls could regain control, driving the cable towards 1.4270 and possibly even 1.44.
Attached Image
We wish you a good start to the new week and many profitable trades!
Here are our daily signal alerts:
Daily Forex Signals:
We are currently short in GBPUSD and this trade has already proven successful.
View our daily signal alerts http://www.maimar.co/category/daily-signals/
www.maimar.co