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US stock indices closed in the red yesterday despite unexpected strong reading of Retail Sales report. One thing to mention: previous month reading has been revised up to +0.3% from -0.2%. Maybe the bad flow of data from US was not that bad? But greenback bulls had limited gains.
We observed an interesting price action during European session yesterday. German GDP posted slightly lower-than-expected figures with the previous period upside revision. EURUSD fell initially, but has found buyers closer to 1.1725. Our buy-limit orders around 1.1717 were not triggered. British CPI lower numbers caused a sharp sell-off of the sterling and we joined the party with shorts of GBPUSD (+94 pips) and longs of EURGBP (+48 pips). Our mid-term outlook for EURGBP parity remains in place.
GOLD and SILVER.
We took profit from almost all of our shorts for the precision metals. We think they will bounce to the upper range of Bollinger Bands H1, so we’ll monitor price action closely to find good levels to renew our shorts.
EUR.
We still hold our longs of EURUSD (daily bullish MACD divergence plus fundamental outlook), EURJPY, EURCHF and EURNZD. We took profits of EURGBP longs. It seems like pound could come back to it’s tight range. Eurozone GDP in focus.
JPY
We have added longs of USDJPY on the pullback yesterday around 110.35 and hold previous bullish positions from lower 109 figure. Risk appetite factor picks up the momentum all over the world with positive fundamentals, so we will target 112.50 or even higher.
Markets also expect FOMC minutes to be released later today (06:00 PM GMT). Usually it’s a big market mover in the sense that investors are trying to understand and predict next FOMC move. But we do not think, that we will see something completely new today. Doubts and talks about next rate hike in December will remain and it will not give something heavy in the hands of greenback bulls.
Please note, that this article comes from my archive. Check the actual date in the header.
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