Correction on the Go

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Correction on the Go
Correction on the Go

Correction on the Go

The euro bounced back with around 55 points today as it closed on the critical support level on Friday, where currently it is trading at 1.3787 in the U.S. session on Monday. The Investors are eying on the pending home sales data that is about to be released, where a move above 1.3815 could lead the pair to test 1.3854 and 1.3875 that is its last week’s top.

Whereas, a good outcome of this data can lead the U.S. dollar to get stronger where a move below the critical support level at 1.3728 could allow the bears to enter heavily in the market because below this level would be the bearish zone for the euro.

Firm Pound

The British pound is currently moving in a short range, where a move above its today’s pivot point level 1.6505 could lead the pair to test 1.6530 and 1.6564 resistance levels. On the other hand, a move below its 1.6459 could be alarming for the pound where sellers would feel confident to short the pair. However, chances are that the pair would remain bullish at least until the release of construction, services, and manufacturing PMI data.

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Provided that the data comes out to be better than expected, then the BoE would revisit its plan to increase the interest rate as the economy is doing well and is in a good shape.

Aussie Short

Selling can be done right now at this level on Aussie, where it is testing its critical resistance area where it has bounced back from 0.8890 and is trading at 0.8886. Stop losses can be set at a tight level where it could be 0.8912 or 0.8920, plus if price moves below the pivot point level 0.8880 then heavy selling could be seen since it would allow the sellers to get confident on their short positions. Make sure that you set your stop losses because bank holidays on New Year could then create a gap when the market resumes the next day.

To contact the reporter of this story: Jonathan Millet at john@forexminute.com