FOREX NEWS: ACTION PICKS UP, BACKED BY ECONOMIC RELEASES
EUR/USDForex News: Volatility for the EUR/USD pair is dropping to almost record lows, making price action slow and choppy. Yesterday US Banks were closed, contributing to the type of movement we mentioned above, but overall we had a bullish day.
Technical OutlookThe pair rallied yesterday to touch 1.3650 but we consider this to be just a retracement generated by the oversold condition of the Relative Strength Index (Daily and four hour chart) and we believe that price cannot continue much higher. The first hurdle for the bears to overcome is the minor support created at 1.3615 while 1.3650 still holds as resistance, followed by 1.3700.
Fundamental OutlookThe United States will announce their Durable Goods Orders today at 12:30 pm GMT and the forecast is a major drop from the previous 2.9% to -0.5%. Such a drop, or any lower value, would indicate a slowdown of manufacturing activity and would weaken the US Dollar. At 2:00 pm GMT the US Consumer Confidence will be released, with an increase anticipated: 83.2 from the previous 82.3. Confidence among consumers is often an indication of future consumer spending and better than anticipated numbers usually strengthen the US Dollar.
GBP/USDThe pair also had a very narrow range yesterday, mostly due to the fact that both U.S. and British Banks were closed. Bulls controlled the day but no special developments took place.
Technical OutlookYesterday�s slow price action doesn�t offer a lot of clues regarding future direction but for the time being, the support at 1.6820 is still holding and the rejection seen here can easily take price into 1.6880 resistance once again. A break of 1.6820 would open the door for a touch of 1.6750 and maybe a full scale reversal of the long term uptrend.
Fundamental OutlookThe British Bankers� Association will announce today at 8:30 am GMT the Mortgage Approvals (previous 45.9K; estimated 45.2K). This is a leading indicator of house market demand because normally a house is purchased with the help of a mortgage; also, houses are usually purchased in times of economic expansion so higher numbers for today�s release are beneficial for the Pound.
