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With ECB head Lagarde due to give a speech in the London session, I’m hoping to see enough volatility for a pullback on this pair.

Currency Snapshot:

Major Forex Pairs Price Performance from MarketMilk
Major Forex Pairs Price Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Forex Calendar:

  • German factory orders due at 7:00 am GMT
  • ECB President Lagarde to testify at 8:00 am GMT
  • EU economic forecasts at 10:00 am GMT
  • U.S. Challenger job cuts at 1:30 am GMT

What to Watch: EUR/NZD

EUR/NZD 1-hour Forex Chart
EUR/NZD 1-hour Forex Chart

Risk appetite has recovered in recent trading sessions as China seems to be stepping up its game when it comes to keeping the coronavirus outbreak and its impact on the economy contained.

This was enough to bring EUR/NZD down to the 38.2% Fibonacci retracement level on its recent rally, and it appears that buyers are trying to defend this area. A deeper pullback could last until the 50-61.8% Fibs that span an area of interest.

EUR/NZD Trend Analysis from MarketMilk
EUR/NZD Trend Analysis from MarketMilk

Moving averages are mostly bullish on this pair, with the 100 SMA above the 200 SMA to confirm that the uptrend is more likely to resume than to reverse.

A bounce off the 1.6900-1.6925 area could take EUR/NZD back to the swing high around 1.7175, and a stop below the 1.6850 area could be enough to weather the pair’s average daily volatility.

EUR/NZD Volatility from MarketMilk
EUR/NZD Volatility from MarketMilk