The EUR/GBP has decreased aggressively today and have
filled the yesterday’s gap up, the pair has found strong resistance in
yesterday’s trading session and was forced to decrease on the short term. EUR/USD
has edged higher in the previous week as the price has fund strong support, the
pair has failed to resume the downward movement and now is struggling to climb
much higher on the short term. The price has increased because the Cable has
lost ground versus all its counterparts, the pair maintains a bullish perspective
on the short term as the uptrend remains intact.
The Euro was punished a little by the Euro-zone economic figures,
the German industrial Production has increased by 0.8%, matching expectations,
has managed to increase again after two decreasing months. The French Gov Budget
Balance has decreased further, from -27.5B to -56.5B, while the Trade deficit
has increased from 4.2B to 5.2B and has weakened the Eur. Moreover the
Euro-zone Revised GDP has increased unexpectedly higher in the Q1, has risen by
0.6%, exceeding the 0.5% estimate. The
Cable has received a helping hand from the Halifax HPI report, the economic
indicator has increased by 0.6%, much compared to the 0.3% estimate, remains to
see how the price will react tomorrow after the UK’s manufacturing production
was released, the manufacturing sector is predicted to increase by 0.1% for the
second months in April.
The rebound from the last week was expected because the pair has
found strong support at the lower median line (lml) of the ascending pitchfork
and then has jumped again above the 38.2% retracement level. The bullish
momentum was very strong and has broken and closed above the median line (ml)
of the descending pitchfork, as you can see on the Daily chart, the pair has
opened with as gap up on Monday, but the bears have taken he lead again and has
erased the Monday’s gains.
The Euro is struggling to drag the price higher again, the pair is
trading much above the median line of the descending pitchfork, could challenge
the 50% retracement again if the EUR buyers will take the lead again. The
perspective remains somehow bullish on the short to medium term as long as the
price is trading inside the ascending pitchfork’s body, could be attracted
right now by the strong confluence between the median line of the ascending
pitchfork with the upper median line of the descending pitchfork, but he needs
to take out the strong resistance from the 50% retracement level.
The medium term corrective phase will continue only if the price
will jump and stabilize above the 61.8% retracement level, this scenario is
less likely right now, we’ll have to wait till after the Brexit referendum, because
most likely will have a clear direction, this event will bring high volatility
on the pair.
The pair is fighting hard to climb higher again, the price has
closed the former gap up, but wasn’t able to close below the minor median line
(ml), actually the price has closed above the median line, signaling that
another leg higher could come.
About The Post
About The Forex Analyst
Has graduated a Master in Business Administration, Trader/ Market Analyst on the financial markets (forex, commodities, index, stocks, futures, cryptocurrencies) for more than 7 years. Founder and Market Analyst at http://ovtbusiness.com/