INTERNATIONAL CURRENCY BUZZ :
- Forex – Dollar drops on doubt U.S. rates will rise at all in 2016
- Forex -Aussie, kiwi edge higher vs. greenback on Yellen remarks
- Forex-Dollar broadly lower after Yellen strikes cautious tone
EUR/USD trades dead flat at 1.1294, fighting hard to break through 1.1300 levels. The main currency pair is seen consolidating the upside in the Asian trades, having witnessed a 120-pips massive rally on Tuesday following the dovish comments from Fed Chair Yellen. The major jolted higher in the previous session and climbed to fresh weekly highs at 1.1303 as the US dollar was heavily offered after Yellen sounded concerned over the global economic developments and hence, turned cautious with regard to the monetary policy path. Markets now gear up for fresh macro data from Germany as well as the US, which are expected to have major impact on the EUR/USD pair. We have the German Prelim CPI figures and ADP employment report from the US on the cards this Wednesday.
The Sterling rallied with London opening, up to 1.4450 against the greenback, from where the pair is currently retreating, towards the 1.4400 region. Once again, the UK calendar remained empty, with dollar ́s weakness being the main market driver. With stocks rallying across the world, there’s little room for dollar gains later today, albeit the release of the US ADP report may gave the greenback a short lived boost if it beats expectations. Crude oil stockpiles may also affect the Pound, as another surprise rise may send the currency lower. In the meantime, the 4 hours chart shows that the technical indicators are beginning to look exhausted towards the upside in overbought territory, suggesting the downward corrective move may extend, particularly on a break below 1.4360, the immediate support. Nevertheless, the dominant trend is still bullish, and the market will probably prefer to buy the dips. Only below 1.4330, the 61.8% retracement of the latest bearish run, the downside potential will increase, exposing then the 1.4250 static support.
- BUY GBP/USD ABOVE 1.4450 TARGET 1.4470 1.4500 SL BELOW 1.442
- SELL GBP/USD BELOW 1.4368 TARGET 1.4348 1.4318 SL ABOVE 1.4398