Video: EURUSD Distracted by Anticipation, GBPUSD Less Encumbered
• When there is high-profile and known event risk ahead, it can anchor the markets and prevent swings
• The Euro is a prime example of a currency that is is locked down until 'Greece' is resolved as a risk
• In contrast, mild fundamental bumps for the likes of GBPUSD can allow for restrained swings
Find out what scheduled event risk can threaten your trades or trigger volatility with the DailyFX Economic Calendar.
When there is major event risk ahead, anticipation can kill momentum and trade development. That is a burden that EURUSD and Euro crosses seem to be currently facing. With the Greek financial situation developing day-to-day, it is difficult to generate conviction for a bullish or bearish view amongst the trading ranks. In contrast, the absence of major event risk can also free a market to move under natural speculative currents via technical developments. I was hasty in writing off GBPUSD to start the week as it lacked a 'motivator' to carry momentum. While something definitive that favored a Dollar rally or Sterling tumble - such as a definitive headline that alters eithers' interest rate forecast - could have raised the potential for momentum; it is less important to accomplish lower-boundary developments. A swing within a range versus a breakout with follow through for example can occur more easily with a lack of fundamental driver. We discuss the open air for 'unencumbered' pairs and look at a few in today's Strategy Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.