It’s Super Thursday, people! If you’re hoping to trade the news, this trend setup on Guppy might be worth looking at.
Will bulls return at these retracement levels.?
Before I show y’all what I’m looking at, check out the top headlines that rocked the forex market scene:
- U.S. ADP non-farm employment up by 174K vs. projected 48K gain
- U.S. ISM services PMI up from 57.2 to 58.7 vs. 56.7 forecast
- Crude oil inventories down by 1M barrels vs. projected 0.6M drop
- New Zealand preliminary business confidence index up from 9.4 to 11.8
- Australian NAB quarterly business index up from -8 to +14
- Australian trade surplus widened from 5.01B AUD to 6.79B AUD
- Australia’s exports up 3% in December 2020 vs. 6% forecast
- PBOC refrained from injecting additional liquidity, tapped 14-day repos instead
- Crude oil higher as OPEC+ renewed commitment to output cuts
Upcoming Potential Catalysts on the Economic Calendar:
- Swiss SECO consumer climate index at 6:45 am GMT
- ECB economic bulletin at 9:00 am GMT
- U.K. construction PMI at 9:30 am GMT
- BOE policy decision, quarterly monetary policy report, and MPC minutes at 12:00 pm GMT
- BOE Governor Bailey’s presser to follow
What to Watch: GBP/JPY
Anyone up for a simple trend setup on Guppy?Price has formed higher lows and higher highs inside an ascending channel and looks ready to test support again.
This happens to coincide neatly with the 61.8% Fibonacci retracement level and a former resistance zone, which might hold as a floor. The 100 SMA is above the 200 SMA to suggest that the uptrend is more likely to resume than to reverse.
Stochastic is heading lower but closing in on the oversold region to signal potential exhaustion among sellers. Turning higher would mean that buyers are returning and could push GBP/JPY back up to the swing high or channel resistance.
Of course the BOE Super Thursday is a major event risk that could lead to bigger price swings than usual. No actual monetary policy changes are expected, but any major downgrades to economic forecasts might spur a reversal on this rally.