EUR/USD FUNDAMENTALS AND TECHNICALS
Pair closed last week’s trading session higher after ECB was mot as dovish as usually. Even though the central bank kept its monetary policy unchanged the removal of the usual wording “we will continue to monitor the exchange rate of Euro” pushed the pair higher. On the other hand, comments from new US President Biden, promising to boost stimulus program with an additional personal check of 1,400 US Dollars and the stimulus program to 1,9 billion US Dollars added additional upside momentum on the pair.
As for this week, traders will mainly focus on Wednesday’s FED’s meeting. No change of policy is expected at this meeting but still worth to follow for any future moves the FED will take. The usual tone from the FED that will keep accommodating the policy if it needs and may add more selling pressure on the US Dollar. Vaccination all around the world keeps moving as it was expected boosting hopes for a better global economic growth. This will result in more US Dollar outflow.
On the economic calendar, we have on Monday, German IFO business climate point slightly lower at 92 On Wednesday, German Gfk consumer confidence survey lower at -7.8 US Durable goods orders to remain unchanged at 1% On Thursday, German Harmonized index of consumer prices expected higher at 0.5% and US Gross domestic product lower at 3.9% On Friday, German gross domestic product expected lower at 0% US core personal expenditure lower at 1.3% and Michigan consumer sentiment unchanged at 79.2.
Technically, the picture is neutral to positive. Pair retreated from lower level after tested support at 1.2075 (38.2%) In this week’s trading session if the pair continues the upside and break and close above (23.6%) 1.2170, the picture will be turned to positive with next level 1.2350 (0%) if pair resumes downside will need to break and close below 1.2060 to change the picture to neutral negative. Our traders keeping open their long positions at 1.2174 and 1.2060 targeting profits at 1.2350. If pair continues the upside, we are expecting buyers to trigger trailing stops at 1.2200 and sellers to appear above 1.2200.
GBP/USD FUNDAMENTALS AND TECHNICALS
Pair closed higher last week’s trading session with the GBP overshadowing increasing cases and deadliest new coronavirus variant. Recent upbeat recovery in pair is mainly due to weaker US Dollar as vaccination are ongoing according to the government’s program and adds hopes on faster economic recovery investors are fleeing away from the save haven US Dollar.
As for this week, traders will focus on Wednesday’s FED meeting for any fundamentals that may change the pair’s upbeat move or reverse it on the downside. On the GBP side, traders will follow any new releases from UK government on the new extended lockdown measures and if any additional stimulus packages might be introduced to cover companies’ salaries and help employees, working from home.
In the economic calendar, we have on Tuesday, ILO unemployment rate pointing higher at 5.1% and average earnings higher at 2.8%
Technically the pair is positive after last week’s upside move and close just below 0% at 1.3680. In this week’s trading session if pair continues the upside, we are expecting to retest 1.3750 A break above this level will target as next level 1.3800 Alternative if pair retreats on the downside, first level to be retested is 1.3450 with the first strong support of 1.3150 (23.6%). Our traders keeping open their short positions at 1.3500 and 1.3600 targeting profits at 1.3150. We are expecting buyers to appear below 1.3450 till 1.3150 targeting profits above 1.3700 and short sellers to continue selling on the way up or taking profits on the way down.
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