Dear Traders,
The euro gave up some of its gains on Friday but the decline has been stopped above the current support zone at 1.1050-70. Further upward momentum is still possible in case the euro breaks significantly above 1.1180 and further 1.1220. Next resistances are seen at 1.1245 and 1.13.
EUR/USD
Currently we see a symmetrical triangle in the 4-hour chart predicting breakouts as soon as the price exceeds 1.1180 (bullish breakout) or vice versa falls below 1.11(bearish breakout). However, we should take into account that bearish momentum could be limited as long as the barrier at around 1.1050 remains intact.
The British pound traded sharply higher against the U.S. dollar Friday. The dollar will be back in focus this week with the FOMC meeting dominating the market on Wednesday. While the Bank of England is also scheduled to decide on monetary policy on Thursday no changes are expected. However even if the BoE decision is anticipated as a non-event for the pound the MPC minutes could provide hints on the trajectory of the central bank's monetary policy.
GBP/USD
The cable formatted a recent upward channel within an overall downward trend. Based on that channel it seems as if there is still some room for further gains towards 1.4480/1.45. Breaking above that channel a next hurdle could be at 1.4620. On the bottom side we expect the 1.4250-area to lend a support for the currency pair.
This week all eyes will be on the FOMC announcement on Wednesday. While the Federal Reserve is expected to hold interest rates unchanged in March economists are split over how aggressively the Fed will signal the likelihood of future rate hikes. Considering the loss of confidence in monetary policies we might see the dollar tumbling despite any hawkish comments from Fed chair Janet Yellen. Given the fact that there is no interest rate hike priced in for this month the greenback could trade lower ahead of FOMC.
Apart from the rate decision U.S. Consumer Prices scheduled for release on Wednesday and the U.S. Retail Sales report (Tuesday) could set the tone before going into the Fed's March meeting.
We wish you a good start to this week and many profitable trades.
Daily Forex signals:
View our daily signal alerts http://www.maimar.co/category/daily-signals/
We wish you good trades and many pips!
Any and all liability of the author is excluded.
