EUR/USD FUNDAMENTALS AND TECHNICALS

 

Pair closed last week’s trading session marginally lower after mixed signal from US labour market sea saw the pair price. With the ADP employment better than expected and the nonfarm payroll worse than expected, the pair attempted a lower move during the week and end up higher by Friday late session.

As for this week, traders will be focusing on ECB monetary policy meeting. Even though no change in policy is expected at this meeting, the speech that will follow and comments from ECB president Lagarde will weigh on pair price action. On the US Dollar side, traders will search for comments from FED’s officials as the disappointing number of non-farm payroll might be seen as positive for the economy and in combination with the recent inflation, could put additional pressure on FED towards faster than expected monetary normalization.

On the economic calendar we have on Monday, German Factory orders expected lower at 1%. On Tuesday, German industrial production lower at 0.7% European gross domestic unchanged at -1.8% and German ZEW Survey economic sentiment higher at 85.3 On Thursday, ECB interest rate decision and monetary policy minutes will be released with a press conference to be followed.  US Consumer Price Index expected higher at 4.6% on year to year basis. On Friday, the Michigan consumer sentiment index expected higher at 84.

Technically, the picture is positive. Pair closed just on (23.6%) at 1.2170 and this keeps a positive bias for the pair. In this week’s trading session if the pair continues on the downside, we are expecting to test the next support of (38.2%)1.2058 If the pair resumes upside and close above last week’s higher level of 1.2240 will accelerate gains toward 1.2341 (0%) 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 lower after an unsuccessful attempt to break lower. Downside pressure on the pair came from two different sides. The first is the Indian variant of covid-19 that is spreading fast in the UK and keeping the government on hold for the reopening plan. The second is the better than expected ADP employment from the US. Although by the end of the week we’ve seen all losses to be fully recovered after a worse than expected nonfarm payroll sea saw the markets.

As for this week, traders will be closely monitoring any FED comments on the labour market improvements and the US Inflation number. Extra attention needs to be taken to BOE’s Haldane speech. If Haldane will back up Vlieghe, this will add upside momentum on GBP. Due to the UK light economic events, the main actor behind any price action on this pair will be the US Dollar.

In the economic calendar we have on Monday, BRC Like-for-Like retail sales pointing higher at 39.6% On Friday, Manufacturing production expected lower at 1.5% and Gross domestic product higher at 42%

Technically the pair is positive after keeping trading higher and flirting with 0.0% level. In this week’s trading session if the pair trades on the upside and close above 1.4250 will open the road to the next level of 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

 

 

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