5Feb
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IForex Market Trading Signals and News – 05 February 2016

INTERNATIONAL CURRENCY BUZZ :

  • Forex -Australian, New Zealand dollars steady near 1-month highs
  • Forex -Dollar on defensive after broad decline on rate hike doubts
  • Forex – No traction for dollar after Fed rates collapse

EUR/USD
EUR/USD is trading above the 1.11 line in Thursday’s European session, following sharp gains a day earlier. On the release front, there are no major Eurozone events. ECB President Mario Draghi will deliver remarks at an event in Frankfurt. In the US, today’s key event is Unemployment Claims, with the indicator expected to remain steady at 279 thousand.The shared currency picked-up significant strength versus its American counterpart in the last hours, with EUR/USD now hovering near multi-month highs above 1.1150.Currently, EUR/USD trades 0.44% higher at 1.1153, having printed fresh four-month highs at 1.1162 last minutes. The latest upsurge seen in the EUR/USD pair was triggered by ECB’s Chief Draghi’s pledge to fight inflation, as he spoke at the Deutsche Bundesbank’s Marjolin Lecture, in Frankfurt. Further, the EUR/USD pair completely ignored the risk-on rally in the European stocks and strengthened further as the US dollar halted its correction and resumed its broad based sell-off ahead of the US data releases, including the jobless claims and factory orders, which are likely to disappoint markets.

GBP/USD
The broad based USD sell-off seen in the NY session ran out of steam in Asia, opening doors for a drop in the GBP/USD below 1.46 levels.UK side of the story is likely to have a major say in determining the exchange rate as we move closer to the Super Thursday events- BOE rate decision, Minutes, Quarterly Inflation Report (QIR). Markets are expecting the central bank to maintain its dovish stance. Later in the day, US weekly jobless claims are due for release. Apart from the data, the broader market sentiment and the resulting impact on the USD could influence the pair. The spot currently trades around 1.4570. The immediate resistance is seen at 1.46, ahead of the major hurdle at 1.4649 (previous day’s high), which if taken out shall open doors for a rally to 1.4712 (50-DMA). On the other hand, a break below a strong support zone of 1.4519-1.4515 (38.2% of 1.5230-1.4079 + 23.6% of 1.4079-1.4649) would open doors for a slide to 1.4431 (38.2% of 1.4079-1.4649).

RECOMMENDATION :

  • BUY GBP/USD ABOVE 1.4650 TARGET 1.4670 1.4700 SL 1.4620
  • SELL GBP/USD BELOW 1.4610 TARGET 1.4580 1.4550 SL 1.4640

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