FOREX NEWS: INTEREST RATES AND PUBLIC SPEECHES. VOLATILITY IS ALMOST CERTAIN
Forex News: Price action slowed down considerably yesterday compared to the previous day and we saw a small retracement lower which didnít manage to touch 1.3900. Janet Yellenís speech generated some volatility but was mostly overlooked by market participants.
The picture remains bullish and moves north are favored after a touch of 1.3900. The Relative Strength Index is just coming out of overbought territory, heading down and thatís why we anticipate a touch of 1.3900 before price can resume upwards movement, headed for 1.3965. However, a lot depends on the ECB stance that will be presented today during the Press Conference.Fundamental Outlook
At 11:45 am GMT the European Central Bank will announce if any changes were made to the Interest Rate (currently 0.25%) and at 12:30 pm GMT, ECB President Mario Draghi will hold a Press Conference during which he will answer journalistsí questions and will talk about future monetary policy direction. The Rate is not expected to change but the ECB Press Conference is considered one of the most important events for Euroís short term movement so we recommend extra caution if trading during it. Fed Chair Janet Yellen will testify today before the Senate Budget Committee and this is another reason for increased volatility but the marketís reaction remains to be seen.[b]GBP/USD
Similar to the Euro, the Pound retraced yesterday but the bearish move lacked strength and the market was mostly in a ranging state, with a lot of choppy price action.Technical Outlook
The Pound is showing tremendous strength lately and yesterdayís bearish movement was not convincing, but a touch of 1.6920 is not out of the question. If this touch occurs, it will most likely trigger a bounce higher and the first barrier in front of rising prices is the latest top created at 1.6996, followed by 1.7040 resistance.Fundamental Outlook
The Pound will be affected today by the release of the Official Bank Rate which usually creates volatility even if no change takes place. The event is scheduled at 11:00 am GMT and no change is anticipated from the current 0.50%. Yellenís testimony later in the day will have an impact as well.