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Old 04-09-2014, 11:27
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Default Technical News | GDMFX Brokerage | Daily


Forex News: A cease-fire agreement between Russia and Ukraine strengthened the single currency and triggered a move up. Market participants overlooked the disappointing value of the European Retail Sales and the pair experienced a bullish day.

Technical Outlook
From a purely technical point of view, a bounce off of the current level at 1.3150 is very likely. If this bounce occurs, the next destination is 1.3100 support, but Mario Draghiís speech and the ECB interest rate decision will decide the dayís direction and the technical aspect will be secondary.

Fundamental Outlook
At 11:45 am GMT the ECB will make public their decision regarding the interest rate which is not expected to change from the current 0.15%. A Press Conference will follow at 12:30 pm GMT and during this conference the highest volatility of the day will probably be seen. There has been a lot of talk about additional measures adopted by the ECB to stimulate economic growth and during the press conference ECB President Mario Draghi will probably answer questions on the matter. His attitude will be closely watched by market participants and will trigger sharp moves.

A privately owned company will release an early version of the US Non Farm Employment Change at 12:15 pm GMT. This data tries to mimic the government issued indicator which is released Friday and usually has a hefty impact on the market. The anticipated number is 216K and higher values usually strengthen the US Dollar but Fridayís indicator normally has a higher impact.

The pair retraced higher yesterday with the help of a better than expected value of the Services PMI but bears regained control later in the day and a new low was printed.

Technical Outlook
The pair reached the important support located at 1.6460 but now it shows clear signs of slowing down. We can see multiple candles which suggest indecision and the Relative Strength Index reached oversold territory. This makes it harder for the bears to push the pair further down and increases the chances of bullish retracements but price action will be influenced by the fundamental aspect.

Fundamental Outlook
At 11:00 am GMT the Bank of England will announce the interest rate but no change is expected (currently 0.50%). Because a Statement is issued only in the case of a rate change, today we will probably not have any information about the reasons that stood behind the rate decision and this diminishes the impact of the event. However, surprises can happen and we recommend caution if trading at the time. The US events will have a direct impact on the pairís movement throughout the day.
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