Hello Traders,
Today we expect policy announcement by ECB and as the drums sound, there are more political and economic concerns that can change ECB’s outlook. From previous meeting there were talks of stimulus being extended at a constant pace of 60 Billion Euros through to December and beyond depending on how inflation trends and gravitates towards the governing council objectives. As a matter of fact, many analysts are upbeat about growth and inflation expectations of the Euro zone. From Barclays to Morgan Stanley, the general view is that growth projections for 2017 will be revised higher from 1.7% to at least 1.8%. Inflation is also expected to tick up from 1.3% to 1.4% but the real deal, factoring in all the recent developments, is what the ECB thinks of the coming years. All that is what should spark the market. In Britain, Philip Hammond, the British Finance Minister is cautious with the state of the economy and the impact of leaving the EU. As he sets the cause of government spending, he raised growth expectation this year to 2.0% up from 1.4% in November but this is expected to dip as Brexit takes its toll. Moreover, inflation is set to rise to 2.4% and decelerate in 2018 and 2019 to 2.0%. Also released earlier is the RICs House Price data which many expected to tick lower to 23.00. It remains stable at 24.00 which slightly elevated the Pound from yesterday’s losses.
I will look to short the Pound now and take about 60 pips from the market. In the 30 min chart price action is overextended with a whole candlestick closing above the upper BB. The stochastics are also oversold with a sell signal already printed.
Trading will be as follows:
Sell: 139.50
Stop Loss: 139.80
Take Profit: 138.90
Have a good trading day.

GBPJPY 1Hr Chart-09.03.2017

Source: Dalmas Ngetich

GBPJPY30 Min Chart-09.03.2017

Source: Dalmas Ngetich

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