EURGBP: Trades within range but clear levels of S/R to consider

• AUD Unemployment higher than GCF, and at 12-year highs

• Construction Index sees a 3rd consecutive rise to 55.2, its highest this year, to show further strength for the sector, but overshadowed by poor employment data.

UP NEXT:

• BoE Rate Decision is likely to remain at 0.5% but the accompanying rate statement may shed light on the timing of any rate changes. Any Hawkish comments should support GBP and provide upside for Cable, but any Dovish remarks could see it trade towards (and maybe below) last week’s lows. At present I favour a mini bullish move before losses resume, judging from price action.

• ECB Bid Rate arrives shortly afterwards so we can certainly expect volatility on both GBP and EUR crosses. So an obvious place to look is EURGBP.

• US Employment data will be assessed to see if it shows improvement from last week's Nonfarm Payroll data, which fell short of expectations. USD looking weak at current highs then poor employment data should help USD edge even lower and provide additional support for the Majors such as GBPUSD, EURUSD and NZDUSD. USDCAD also looks like it has extra room for losses.

TECHNICAL ANALYSIS:

EURUSD: With Draghi speaking it could go either way, both ways (and in no particualr order)

Due to the Eurozone Bid Rate tonight and accompanying statement I have provided no directional bias for the intraday timeframe. However I have included key support/resistance zones where I expect price reactions, regardless of what drives it.

However if I refer to the daily timeframe then I do favour a retracement against the bearish trend. We saw a Bullish Pinbar on higher volume to suggest a change in hands, which could see EURUSD gains and aid the DXY retracement.

EURGBP: Trades within range but clear levels of S/R to consider

For a more directional move we would need diverging messages from both BoE and ECB tonight. With BoE going first it may be best to step aside until the first release, see if it falls within 'Hawkish' or 'Dovish' then take a trade accordingly prior to ECB conference (using relatively wide stops to allow for extra volatility).

Alternatively wait for both statements to arrive and seeing if we get price action to confirm the statements, then seek trades that match the fundamental and technical direction.