Wednesday's FX Analysis: Poor GDP Numbers Could Spark GBP Selloff
Littlefish FX | Apr 24, 2013 04:44PM ET
Wednesday was another relatively quiet day for the markets. Despite poor German IFO numbers, the euro remained well supported, rejecting the 1.2970 level and closing again above the 1.3000 level.
Wednesday afternoon saw U.S. data (Durable) again come in worse than expected. More poor U.S. data is expected, and it continues to put pressure on the USD.
Thursday's early trading sees the UK GDP figures. Similar to the euro, the Pound has remained relatively well supported above the 1.5200 level. A poor GDP number could accelerate a move lower again.
Given relatively poor U.K. data recently, a poor GDP number could easily be on the cards, spurring the final U.K. downgrade by S&P. We could also see talk of a triple dip recession, which in turn could offer a nice EUR/GBP long option which remains supported above the 0.8500 level.
EUR/USD
The euro rejected a move lower again today. We suspect this pair could test the 1.3085 level and weekly pivot point as it continues to chop sideways.
Personal Bias: Bearish
Support: 1.3000 / 1.2970
Resistance: 1.3085 / 1.3170
Break of 1.3000 to offer shorts or short from current levels targeting 1.2730. Look for a close below 1.3000
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