After two days of low volatility and small market movements we might see an increase in volatility today with the March FOMC minutes being scheduled for release ahead of the upcoming meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping. The meeting is of high significance and is expected to set the tone for future developments of China-U.S. relations. Consequently, the market will take its cue from that meeting.
We therefore prepare for larger market movements which may occur as early as today. As expected, the euro traded between 1.07 and 1.06 on Tuesday and traders should keep an eye on significant price breakouts either above or below that trading range. Above 1.0715 we see a higher likelihood for further bullish momentum, driving the euro towards 1.0820. On the bottom side, we will focus on a break below 1.0585 in order to sell euros towards 1.05.
The British pound consolidated between 1.2470 and 1.2420. From a technical perspective, we now see chances for a breakout in the near-term. Prices narrowed, formatting a symmetrical triangle in the hourly chart this morning and based on that chart pattern, bullish momentum may accelerate after a break above 1.2450, whereas bearish may increase after a renewed break below 1.2430. If the pound climbs above 1.2525, it may head for a test of 1.26. Below 1.2380 however, we favor a bearish bias, targeting at 1.23 and 1.2250.
There is plenty of important U.S. data scheduled for release today, so traders should prepare for some volatile swings around the time of the following reports:
8:30 UK Services PMI
12:15 USA ADP Employment Change
14:00 USA ISM Non-Manufacturing Composite
18:00 USA FOMC Meeting Minutes
(Time zone UTC)
Here are our daily signal alerts:
EUR/USD
Long at 1.0720 SL 25 TP 30-40
Short at 1.0630 SL 25 TP 20, 40
GBP/USD
Long at 1.2485 SL 25 TP 20, 60
Short at 1.2415 SL 25 TP 30, 60
We wish you good trades and many pips!
Disclaimer: Any and all liability of the author is excluded.