Forex News: Choppiness Continues as the Pairs Struggle to Find Direction
Forex News: Yesterday the pair remained in a choppy and tight range, without any major developments. The bulls failed to capitalize on the break of resistance and price returned below the level. The lack of major economic announcements contributed to this behaviour.
The break of 1.1875 didn’t generate a strong continuation climb and soon the pair retraced lower but the bearish move lacked strong momentum and the entire session was choppy. As long as the pair is still trading above the 50 Exponential Moving Average the bias remains bullish but this doesn’t exclude a drop into the 50 EMA and the support at 1.1825. Another break of 1.1875 resistance should be considered a true break only after a full bullish candle closes above the level.
Today we have two economic releases that can affect the US Dollar: the Durable Goods Orders scheduled at 1:30 pm GMT and the New Home Sales at 3:00 pm GMT. Higher numbers for these indicators usually strengthen the US Dollar but their impact is low-to-medium and are not known to be major market movers. The expected change for the Durable Goods Orders is 2.1% (much better than the previous -0.8%) and the forecast for the New Home Sales is 654K (previous 685K).
The pair wasn’t affected much by the economic indicators released yesterday but drifted lower and continued to show choppy movement. Price is still in a range, without a clear bias.
Until the pair breaks 1.3320 or 1.3420, it can be considered in a range and we can expect to see reversals on the lower time frames. Yesterday price moved below the 50 EMA then tried to return above it but failed and this is a sign that bearish pressure is increasing; however, the last candle also has a long wick, which is a sign of indecision. Our bias is slightly bearish for the short term, anticipating a touch of 1.3320.
The British Current Account will be released today at 9:30 am GMT and expected to show a value of -21.5 Billion. It measures the difference between imported and exported goods and services and has a medium impact on the Pound. Numbers above expectations usually strengthen the currency.
At the same time the Final version of the British GDP is released but the impact is relatively low. However, higher numbers than the anticipated 0.4% have a positive effect on the Pound.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 7-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.