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Old 01-09-2014, 05:20
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Default Technical News | GDMFX Brokerage | Daily

FOREX NEWS: IRREGULAR VOLATILITY DUE TO AMERICAN BANK HOLIDAY. POUND AFFECTED BY MANUFACTURING DATA



EUR/USD
Forex News: Fridayís main event was the release of the Euro Zone CPI which slowed down from 0.4% to 0.3%, just how analysts anticipated. The drop weakened the Euro and the pair finished the week with the bears in control.


Technical Outlook
Now that price surpassed 1.3150, we anticipate a move closer to 1.3100 after a potential retest of the recently broken level. However, the pair has been on an extended move to the south and the Relative Strength Index is oversold on a Daily chart, signaling that bullish pullbacks are a probable scenario. If this is the case, the first major barrier is 1.3200 which has now turned into resistance.

Fundamental Outlook
American banks will be closed today due to Labor Day and no economic indicators are scheduled for release today. As a result, the New York session might suffer from low liquidity and irregular movement. There are no major European releases either, so we may experience slow and ranging price action during the day.


GBP/USD
The Pound had another slow day Friday and no special developments took place. Price remained confined in a tight range and the anticipated breakout didnít occur.



Technical Outlook
The resistance at 1.6600 and the support at 1.6550 managed to contain price for longer than anticipated and this was mostly due to the lack of major economic releases last week. Today the probability of a breakout is greatly increased but the direction depends mostly on the manufacturing data released by the United Kingdom.

Fundamental Outlook
At 8:30 am GMT the British Manufacturing PMI is released. The indicator is a measure of optimism among purchasing managers from the manufacturing sector and also acts as a leading indicator of economic health. The expected value is 55.1 and a higher number is usually beneficial for the Pound.
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