As traders react to the stronger US data and the ECB rate decision to increase rates by 25 basis points, what are the technical levels in play given the early North American price action.
EURUSD. The EURUSD traded to a new low for the month and lowest level since June despite the ECB rate hike of 25 basis points. The price extended below a swing area between 1.0660 and 1.06669. However, momentum could not be sustained and the price has rotated back to the upside. Traders will be watching the 1.06854 level (the low price from last week) for bias clues in the short term.
GBPUSD: The GBPUSD fell below the 200 day moving average at 1.2432 after the better US data today. However momentum below the level could not be sustained in the priciest trading back above that level. It will now take a move back below the 200 day moving average to increase the bearish bias. Absent that and we could see a rotation back higher on the failed break. The last time the price traded below the 200 day moving average was back in March.
USDJPY: The USDJPY is trading back above its 100 and 200 hour moving averages between 147.03 and 147.12. That level will be the barometer for bullish and bearish in the short term. Stay above is more bullish. Move back below and the sellers take more control.
This article was written by Greg Michalowski at www.forexlive.com. Source