Forex traders are awaiting an expected slow news day in the markets. Overall, trading in the Forex markets has been dictated by moves in global equities over the last few days. Sharp losses to US stocks last week have triggered a flight to quality and have led the dollar higher. The move was especially seen in the EURUSD which fell from above 1.4600 last Thursday to around 1.4300 this morning. The move occurred even as the ECB pretty much indicated that would continue with raising interest rates again in July.
EURUSD
As mentioned above, the EURUSD continues to trade on the defensive. The pair, which had formed a short term base around 1.4450 last Friday, crumbled further when that level was breached. Currently, the EURUSD has found support just above 1.4300. Nonetheless, buyers may again move to the sidelines if European equity markets which are about to pen continue their slide.
Support/Resistance 1.4295/1.4450
GBPUSD
After trading in a two week range between 1.6300 and 1.6475, the GBPUSD broke below its support and has been trending towards the 1.6200 figure. Volatility today though may be limited as Forex traders await tomorrow’s UK CPI figures. The Bank of England has been unwilling to raise interest rates even though inflation has remained stubbornly high. As such, another high reading tomorrow could finally tip the scales for a rate hike.
EURUSD
As mentioned above, the EURUSD continues to trade on the defensive. The pair, which had formed a short term base around 1.4450 last Friday, crumbled further when that level was breached. Currently, the EURUSD has found support just above 1.4300. Nonetheless, buyers may again move to the sidelines if European equity markets which are about to pen continue their slide.
Support/Resistance 1.4295/1.4450
GBPUSD
After trading in a two week range between 1.6300 and 1.6475, the GBPUSD broke below its support and has been trending towards the 1.6200 figure. Volatility today though may be limited as Forex traders await tomorrow’s UK CPI figures. The Bank of England has been unwilling to raise interest rates even though inflation has remained stubbornly high. As such, another high reading tomorrow could finally tip the scales for a rate hike.
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