GBP/USD: current rebound has room to extend - UOB

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Press review

Sergey Golubev, 2015.10.08 09:16

FOMC Minutes expectations by Barclays Capital (based on efxnews article)

Barclays Capital made some expectation and forecasting concerning upcoming Federal Open Market Committee Minutes:

• "Since the September FOMC meeting, a number of FOMC participants have declared that the decision not to raise rates was “close”. We look to the minutes to provide some insight into this statement."
• "We also look to the minutes for context on the new sentence inserted into the September statement acknowledging risks from global economic and financial developments."
• "The minutes are likely to reveal the balance of sentiment between those members who preferred to look through these risks and those members who pushed to postpone any rate hike in an abundance of caution."
• "In addition, the minutes should reveal the number of members who are focused on economic activity abroad rather than just the financial market spillovers to the US."

Just to remind one trading rules for high impacted news event such as FOMC Minutes: more hawkish than expected = good for currency (for USD in our case).

From the technical points of view, the EUR/USD is moved on the border between the primary bearish and the primary bullish in intra-day H4 chart and on daily chart, and any good high impacted news event can move the price to any direction for example. Key support/resistance levels for EUR/USD H4 are the following: 1.1317 bullish resistance and 1.1134 bearish support. On the daily chart we may see 1.1579 key resistance and 1.0878 key support levels.

Once the price breaks key support/resistance levels at least in intra-day basis so it may be the good sign for the direction to be chosen by the price for the next week for example.