Pair closed last week’s trading session marginally higher after FED minutes, showing that only a small number of members start to speak hawkish saying that if the US economy will continue to perform as positive as it did till now, need to start thinking of adjusting the FED policy. Since FOMC gave mixed signals of the bank’s future policy, US Dollars fail to resume upside. On the other side, the Euro shows some positive bias while Covid-19 cases dropped in Europe and the vaccination program continues with success.
As for this week, traders will be focusing only on the economic releases and a few FED official’s speeches. Worth listening to what they have to say and weight whether more hawkish members will join the club. The reopening of many European businesses might be another boost in European economic releases that will result in stronger Euro.
On the economic calendar we have on Tuesday, German Gross domestic product pointing at -3% and German IFO business climate higher at 98.1 On Thursday, German Gfk consumer confidence expected higher at -5.3 US Durable goods orders lower at 0.8% and US Gross domestic product higher at 6.5% On Friday, European consumer sentiment expected at -6 and US Michigan consumer sentiment higher at 82.9
Technically, the picture is positive. Pair closed just above 23.6% at 1.2180 and this keeps a positive bias for the pair. In this week’s trading session if the pair continues the upside, we are expecting to test the next resistance of 1.2240 last week’s top-level and will follow by 1.2341 If the pair resumes downside and close below 38.2% will change the picture back to neutral with next level in focus the 1.1973 (50%). Our traders kept open their short positions at 1.2169 and 1.2240 targeting profits at 1.1973 We are expecting more aggressive sellers at 1.2340 Alternative if pair resumes downside buyers will appear around 1.2000 targeting profits at 1.2170
GBP/USD FUNDAMENTALS AND TECHNICALS
Pair closed last week’s trading session higher on mixed signals from FOMC and on better-than-expected UK retail sales. As it was widely expected the reopening of many businesses and the loosening of many restrictions in the UK boosted consumer appetite, and this resulted in a better-than-expected retail sales number. The unemployment rate in the UK dropped to 4.8% and some upbeat development from the UK and Northern Ireland shows that they are about to resolve some issues on trade.
As for this week, traders will closely monitor the news on the new Indian Variant of Covid-19 as it was fast spreading around UK last week. On others, the pair will solely depend on the US Dollar as there are not any UK economic release to be followed apart from few speeches from BOE MPs
In the economic calendar, we have nothing to follow.
Technically the pair is positive after breaking higher and tested 0.0% level. Although it was rejected for now that level, it is too early to say that trend may change. In this week’s trading session if the pair trades on the upside and close above 1.4250 the next level to be tested is 1.4350 Alternative if the pair resumes the downside the first level to be retested is 1.4000 (23.6%). Our traders are waiting for a pullback around 1.4000 to start buying the pair again. We are expecting short sellers to appear at 1.4250 targeting profits at 1.4000
For more detailed economic calendar events please visit our live economic calendar on:
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