INTERNATIONAL CURRENCY BUZZ
Forex – Dollar Slides to Day’s Lows Ahead of Fed Meeting
Forex – EUR/USD clings to gains near 1.1770, US data eyed
Forex – GBP/USD now faces some consolidation – UOB
EUR/USD alternates gains with losses during the first half of the week and keeps navigating the 1.1760/70 band ahead of the opening bell in Wall Street. The pair continues to navigate in the upper end of the recent range near 1.1800 the figure, although a sustainable breakout of this key resistance still remains elusive. Spot is attempting a very near term sideline theme as global markets expect the Fed decision on rates tomorrow, while jitters on the US-China trade front look mitigated for the time being. In this regard, it is worth mentioning that China cancelled its talks with the US and they’re likely to resume at some point after the US midterm elections. In the meantime, EUR faded part of the Draghi-led recent gains to 1.1800 and above amidst some pick up in the demand for the greenback and a cautious trade ahead if the FOMC gathering on Wednesday. The pair keeps its gains in the 1.1760/70 band ahead of NA open. The greenback remains sidelined above the 94.00 mark.
“GBP closed higher by +0.59% (NY close of 1.3118) as it recovered some of last Friday’s steep loss. The price action is deemed as part of an on-going consolidation phase. In other words, GBP is expected to trade sideways from here, albeit likely at slightly higher range of 1.3085/1.3180”. Next 1-3 weeks: “In our last update, we expected GBP to extend its gains to the July’s peak of 1.3363. GBP subsequently staged an outsized decline that easily took out the 1.3170 ‘key support’ (low of 1.3041 on Friday). While there is no change to the neutral outlook, the break of the ‘key support’ indicates that GBP has likely made a short-term top at 1.3295 last week. The current movement is viewed as the early stages of a consolidation phase and GBP is expected to trade sideways to slightly lower from here, likely within a broad 1.3020/1.3220 range”.
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