Forex News: US Dollar Strength Fades, British Manufacturing Production Eyed for Next Cable Direction
Forex News: The pair showed mixed movement yesterday and a clear direction was not established. This behaviour can be partly attributed to the lack of economic indicators and an overall stale fundamental environment.
Price climbed above 1.0610, created a new short-term high and then soon dropped below resistance. This shows lack of interest and strength from the part of the buyers and makes us anticipate a drop that will probably touch the 50 period Exponential Moving Average and the support at 1.0525. However, the pair is still making higher highs and this means that a continuation of the medium-term uptrend is not out of the question; a quick move above 1.0610 would open the door for 1.0650 and later 1.0710.
We have another lacklustre day ahead, with no major indicators for either the Euro or the US Dollar, thus the technical side will prevail once again.
Yesterday the pair remained in indecision mode and a drop below 1.2125 was quickly reversed as the US Dollar lost steam; for now the pair is stuck in a range, without a clear bias.
From a short term perspective the Pound-Dollar is ranging and this will remain the ‘status quo’ until we see a clear break 1.2125 support or 1.2200 resistance. Rejection is clearly seen around 1.2125 and the oscillators are oversold, facts that make us anticipate a move up in the form of a bullish retracement; a good place for this retracement to end and downside movement to resume is 1.2200 but a quick move below 1.2125 would delay this retracement until 1.2090 is reached.
The British Manufacturing Production numbers will be today’s highlight and also a potential market mover. The indicator measures the change in the value of total goods produced by the manufacturing sector, with higher numbers showing increased economic activity and possibly a stronger Pound. The scheduled time is 9:30 am GMT and the expected change is 0.6% (previous -0.9%).
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.