What a difference combined financial and economic hardship can make: Two years ago, central banks changed their interest rate decisions by 25 basis points, if at all, and even that had usually a big impact on the Forex market, causing wild swings. Now even a 50 bp change from the Bank of England and the European Central Bank is regarded as business as usual, as traders have already discounted such a cut for a long time. We do not expect the upcoming publication of both central banks’ monetary policy (BoE 13:00 CET, CEB 13:45 CET) to change the overall picture in the market. The euro is in a longer-term downmove, but hovering above solid support zones, and therefore due for an upward correction, while the British pound is moving sideways now, back to its lows of mid-2001, against the dollar.
In today’s trading, we see some downward correction moves in the USD, still digesting its overbought situation, as described in the major pairs’ details below. Aside from the upcoming European interest rate decisions, there are no scheduled market-moving economic data today.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
Currently trading at 1.2560, the pair is in retreat ahead of the interest rate decision of the ECB at 13:45 CET today. Short-term oversold now, we do not expect significant downside risk, rather only a testing of the important 1.2500 level, which we expect to hold today and to serve as a springboard for recovery moves up to 1.2640.
GBP / USD
Cable broke the 1.4200 resistance level in early European trading, currently priced at 1.4140. Based on the longer-term still oversold situation, we see more recovery moves to follow today, after testing the 1.4100 mark (now support level), most probably after the interest rate decision by the BoE at 13:00 CET.
USD / CHF
The dollar is still working hard to overcome the 1.1850 resistance level against the Swiss franc, priced right now at 1.1750 in a recovery mood in early European trading. We see this recovery limited to 1.1810 in today’s trading, from where dollar weakness could set in, towards the 1.1680 support zone.
USD / JPY
Gaining some more strength against the yen in Asian trading, the dollar is consolidating its higher levels in European morning hours, currently priced at 99.45. We expect the important 100.00 level to be broken eventually, but not in today’s market, which we see limited to 99.80. Possible down moves then would meet buying interest again at 99.20.
In today’s trading, we see some downward correction moves in the USD, still digesting its overbought situation, as described in the major pairs’ details below. Aside from the upcoming European interest rate decisions, there are no scheduled market-moving economic data today.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
Currently trading at 1.2560, the pair is in retreat ahead of the interest rate decision of the ECB at 13:45 CET today. Short-term oversold now, we do not expect significant downside risk, rather only a testing of the important 1.2500 level, which we expect to hold today and to serve as a springboard for recovery moves up to 1.2640.
GBP / USD
Cable broke the 1.4200 resistance level in early European trading, currently priced at 1.4140. Based on the longer-term still oversold situation, we see more recovery moves to follow today, after testing the 1.4100 mark (now support level), most probably after the interest rate decision by the BoE at 13:00 CET.
USD / CHF
The dollar is still working hard to overcome the 1.1850 resistance level against the Swiss franc, priced right now at 1.1750 in a recovery mood in early European trading. We see this recovery limited to 1.1810 in today’s trading, from where dollar weakness could set in, towards the 1.1680 support zone.
USD / JPY
Gaining some more strength against the yen in Asian trading, the dollar is consolidating its higher levels in European morning hours, currently priced at 99.45. We expect the important 100.00 level to be broken eventually, but not in today’s market, which we see limited to 99.80. Possible down moves then would meet buying interest again at 99.20.
