The British pound is trading a touch lower against a few of the major currencies, including the Euro, the US dollar and the Canadian dollar. However, I think the GBPCAD pair might correct a bit higher from the current levels, which can be seen a sell opportunity in the short term. So, selling rallies should be preferred moving ahead.
There are several resistances on the way up for the pair at around the 1.8300-20 levels. The 200 moving average on the 4 hour chart is also around the same levels. So, if the pair trades higher from the current levels, gets closer to the mentioned resistance level and forms a bearish divergence, then we can jump into a sell trade. Remember, wait for the right time to enter into a trade.
Initial target should be around the 1.8120 level, and final target could be around the 1.8050 level. Stop should be above the 1.8400 level.
Reviewing yesterday’s events and trades
Yesterday, the Euro was seen trading higher during the London session. However, during the NY session, the US new home sales data and CB consumer confidence was released, which exceeded the market expectation. This resulted in an up-move for the US dollar. The pair which suffered the most was the AUDUSD pair. The Aussie is trading below the 0.9380 support area as of writing. One of the other losers was the GBPUSD pair, which plunged after the BOE’s Mark Carney’s remark.
Fundamental Outlook for the day
Today, during the NY session, there are few important economic releases lined up in the US, including the US GDP data, durable goods orders and services PMI. The US services PMI is expected to rise by 0.6 points. If the outcome comes in line or exceeds the market expectation, then the US dollar might trade higher in the coming sessions. It would be interesting to see whether the EURUSD pair can hold the ground in the near term or not, as it is trading in a range for quite some time now.
This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: EURUSD, USDCAD, NZDUSD, EURNZD, EURCHF, USDJPY and EURJPY.
Get it HERE: Vladimir’s Markets Forecast
Trade safe friends. Happy trading!
