Europe Open GBPUSD Breaks 1.6250

EUR/USD H1

Prices were unable to push above H3 during Asian session, putting 1.29 back into focus. We could potentially see similar behavior as yesterday where price stayed around 1.29 levels throughout US trading hours before crashing just a few hours prior. If EUR/USD drop and close cleanly below 1.2890 (yesterday’s low), we could see renewed bearish pressure tonight heading into L5 1.28315 (not shown on chart). Bulls should be wary if price does bounce up from 1.290 but is unable to sustain pressure above 1.2925.

GBP/USD M15

Cable looking mighty bullish compared to EUR/USD with prices breaking H3 suggesting a potential bullish breakout as 1.6235 has been a significant resistance/support even before today. However 1.63 may still prove to be a bridge too far for GBP/USD to push above without any fundamental support.

DAX Futures M15

Bulls survived the early session sell-off which saw DAX dropped more than 30 points without any sort of recovery within the 1st 1.5 hours. However, bears were contained before hitting yesterday’s low of 7,385 and L4. Trading range for today may be similar to yesterday and it’ll take extraordinary bullish news to push DAX back above yesterday’s high of 7,440.

FTSE100 Futures M15

Opening price gapped lower but did not manage to push below short-term consolidation range of 5,830 to 5,840. Similar to DAX, price may be kept within yesterday’s trading range, but unexplained bullishness in GBP/USD may potentially pull FTSE100 higher. Short-term support might be observed around L3 level which is the confluence with the lower end of the consolidation range yesterday @5,830.

Brent Crude H1

Crude prices rally in the past hour reflects the bullishness we’ve observed in currencies and equities. However, price could potentially stall at H3 – round number 111 and top end of consolidation range between 110.50 -111.15. Once again very similar to DAX and FTSE, where trading range today may be kept by Monday’s Highs and Lows, strong market news notwithstanding. However, should we see Crude pushing higher than last Friday’s high, we could see a new wave of risk on rally across both equities and currencies.

Bottomline:

Not much difference in terms of price action. We are not looking at any new developments and other than GBP/USD, prices are still mostly kept within the range we’ve seen on Monday.

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