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22 Apr 2013
Forex Flash: EUR/USD and GBP/USD look rangebound - BBH
FXstreet.com (Barcelona) - Marc Chandler Global Head of Currency Strategy at Brown Brothers Harriman has taken a look at both EUR/USD and GBP/USD from a technical perspective and notes that they both appear to be range bound for the week ahead.
Starting with EUR/USD, he notes that the pair appears to be stuck in the 1.30-1.32 trading range and implied volatility rose over the past week (from 8% to 8.5%), but seems poised to ease and this is consistent with the unclear technical outlook of the spot market and a range trading environment for the euro. Moving to GBP/USD, he notes that the pair has been range bound between 1.52-1.54, However, he notes that the tone is poorer and the 5D MA is set to cross the 20D MA in the days ahead for the first time since March 19th, warning the 6 cent upside correction may be coming to an end. He writes, “A trend line off the March 12 and April 4 lows comes in near $1.5170 at the start of the new week and is near $1.5220 by the end of the week. At the same time, the $1.5190 area corresponds with a retracement objective of the entire correction.”
Starting with EUR/USD, he notes that the pair appears to be stuck in the 1.30-1.32 trading range and implied volatility rose over the past week (from 8% to 8.5%), but seems poised to ease and this is consistent with the unclear technical outlook of the spot market and a range trading environment for the euro. Moving to GBP/USD, he notes that the pair has been range bound between 1.52-1.54, However, he notes that the tone is poorer and the 5D MA is set to cross the 20D MA in the days ahead for the first time since March 19th, warning the 6 cent upside correction may be coming to an end. He writes, “A trend line off the March 12 and April 4 lows comes in near $1.5170 at the start of the new week and is near $1.5220 by the end of the week. At the same time, the $1.5190 area corresponds with a retracement objective of the entire correction.”