Talking Points:
- In this webinar, we looked at price action setups in GBP/USD after UK CPI, EUR/USD after a recent resistance inflection and EUR/JPY after a similar such observation.
- The setup in GBP/USD is especially attractive in scenarios of USD-weakness, as the British Pound has been one of the stronger currencies of recent, as it appears as though Brexit risks/fears are getting priced-out of the Cable. The current level offers an undesirable risk/reward ratio, but we look at how traders might be able to look for a more consistent setup before triggering long in the up-trend. We had also discussed this setup in yesterday’s GBP/USD Technical article, Braced with Bullishness.
- Much of this recent bout of GBP/USD strength has been along with a really strong US Dollar as rate hike expectations out of the United States continue to tilt higher as we near that next FOMC meeting in June; so should the US Dollar get weaker, the setup in GBP/USD could be especially attractive. But if the US Dollar does continue what it’s been doing, which is gaining strength, then traders would likely want to focus elsewhere, looking to buy the Dollar against currencies that have been showing weakness, such as the Euro. We discussed this setup yesterday, and this morning offered a relatively clean hit off of the resistance level that we were watching at the 1.1212 Fibonacci level.
- We also looked at a short-Euro setup against the Yen with another key Fibonacci level coming into play at 123.08. We had outlined that setup in yesterday’s EUR/JPY Technical Article, Prior Support, New Resistance.
--- Written by James Stanley, Analyst for DailyFX.com
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