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Old 23-07-2014, 13:27
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Default Technical News | GDMFX Brokerage | Daily

FOREX NEWS: BEARS BREAK SUPPORT. SOME CORRECTION EXPECTED



EUR/USD
Forex News: The US Dollar strengthened yesterday against the Euro as speculation of Fed increasing interest rates took over the market. The American Consumer Price Index came out as anticipated, at 0.3%.


Technical Outlook
The pair finally broke the support zone created around 1.3500 and is now headed for the next important level of 1.3400 seen on the daily chart above. However, from a four hour chart perspective, the Relative Strength Index has passed the 30 level to the downside once again, suggesting an oversold condition of the market. This indicates that upside corrections are likely to happen today and we expect moves above 1.3480 before price can resume bearish movement.

Fundamental Outlook
Today price action will be dictated mainly by the technical factors since no major economic indicators are released by either the United States or Europe.


GBP/USD
Price moved below 1.7063 yesterday on the back of US Dollar strength but the gains weren’t as significant as the ones seen against the Euro. The pair continues to lack clear direction but the long term uptrend is severely weakened.


Technical Outlook
The first barrier in front of the bears is located at 1.7010 but for the time being the support at 1.7063 is still not clearly surpassed. The four hour candle has long upper and lower wicks, a fact which indicates indecision and shows that control doesn’t belong to either side completely. The pair’s direction will be decided today by the fundamental aspect.

Fundamental Outlook
At 8:30 am GMT the votes on the latest BOE interest rate will be made public, showing how many MPC members voted for a rate change and how many voted to keep the rate unchanged. Analysts predict that all 9 members voted to keep rates unchanged and if this forecast comes true, the impact of the release will be mild.

At 11:45 am GMT, BOE Governor Mark Carney will speak in Glasgow at the Commonwealth Games Trade and Investment conference. As always, his speeches can be accompanied by increased volatility and sudden moves, thus caution is recommended.
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