Tuesday, January 25, 2011

Forex Morning Review | Traders Await UK GDP | 25 January 2011

Forex Morning Review | Traders Await UK GDP | 25 January 2011

Coming up Today (All Times GMT)

* GBP Preliminary GDP (9:30)
* GBP Public Sector Borrowing (9:30)
* CAD CPI (12:00)
* USD Consumer Confidence (15:00)
* GBP BoE Governor Mervyn King Speaks (19:40)

In overnight trading the Bank of Japan left rates unchanged and issued a cautiously optimistic statement. However, they did forecast a reverse of deflation in 2012 due to rising commodity prices. The news had little effect on the Yen, as the USDJPY spent most of the Japanese session in a tight range between 0.8235 & 0.8255. Elsewhere, Forex traders will be watching today’s UK GDP figures, as they are expected to headline today’s news day.


The EURUSD logged another bullish move yesterday as it rallied to three month highs in the face of weekend uncertainty following the collapse of Ireland’s coalition. The pair hit a high of 1.3683, before settling for the evening around 1.3650. Looking ahead, Forex traders will be watching yesterday’s highs as a move above could propel the EURUSD to 1.3700 and beyond.

Support/Resistance 1.3560,1.3640/1.3685,1.3780


With not much going on, the GBPUSD lazily traded back towards 1.6000 yesterday afternoon. Nonetheless, the pair once again saw selling pressure as it approached the 1.6025 level. On the technical side, the GBPUSD continues to have strong resistance between 1.6025 & 1.6055, however it is also within a short term uptrend since last Wednesday’s lows. As such, with UK GDP out this morning, the GBPUSD could be a breakout candidate as a breach below its uptrend or above resistance could trigger Forex traders to jump in with the momentum.

Support/Resistance 1.5910,1.5950/1.6025,1.6055

January 25, 2011 - Markets.com