In today’s forex forecast, we give you the technical outlook for GBP/USD, EUR/USD, EUR/GBP and USD/CAD, with Steven Woodcock, Senior FX Analyst at Plutus FX.
GBP/USD: Range-bound
Woodcock notes that GBP/USD remains in a range, having failed to break out despite last week’s FOMC where Fed dropped the global issues impact from its speech.
EUR/GBP: Sterling will remain firm
Woodcock looks at the technical charts and notes that the previous inverse head and shoulder formation did play out. On the sterling he sees renewed optimising, and expects it to remain firm and data-driven.
EUR/GBP has been the biggest mover among majors. The cross is currently trading heavy and coming into areas where some caution is warranted, says Woodcock.
USD/CAD: Still mirroring oil
USD/CAD is facing some trouble to cross the 1.33-1.34 area, and remains an oil trade. Woodcock adds that the cross remains in its wide 1.28 – 1.33 range, with 1.3050-1.3225 being the tighter – shorter term range.
Woodcock believes that the pair might see a pullback towards 1.2800 area again, and suggests playing the range.
EUR/USD: Buy the support, Sell the resistance
Woodcock notes that EUR/USD is at around similar levels from its previous Monday’s open. The cross will struggle to rally, having being talked down by Draghi previously.
On the trading strategy, Woodcock suggests to play the range game. 1.0850 remains a key level to watch for downside in the pair. He further recommends to add shorts on a break below 1.1017, but with tight shorts.
Forex trade of the week: Sell USD/JPY towards 121.00
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