The Euro had a wicked move shortly after therelease of the better than expected U.S. GDP Report. The initial move was tothe downside because the number only showed a drop to 1.6% rather than thepre-report guess of 1.3%.
The Euro had a wicked move shortly after the release of thebetter than expected U.S. GDP Report. The initial move was to the downsidebecause the number only showed a drop to 1.6% rather than the pre-report guessof 1.3%. After the dust settled, the Euro soared to the upside as tradersreassessed the strength of the U.S.economy.
Technically, the Euro is facing resistance at a short-termretracement zone of 1.2754 to 1.2793. A downtrending Gann angle at 1.2740 isalso providing some resistance.
U.S.equity markets are trading better this morning leading to a surge in thehigher-risk currencies. The Australian Dollar posted a closing price reversalbottom on Wednesday which was confirmed on Thursday. This pattern suggests apossible rally into a short-term retracement zone at .8995 to .9049.
Downtrending Gann angle resistance is at .8921. A breakoutover this angle could trigger an acceleration to the upside which could lead tothe completion of the expected retracement.
Strength in the U.S. equity markets is helping toboost the USD JPY. Rumors of a possible intervention by the Bank of Japan andthe Japanese government are also helping to drive weaker longs out of theJapanese Yen.
The British Pound is trading lower despite a slight upwardrevision in GDP. It was reported that U.K. GDP grew 1.2% versus the previousestimate of 1.1%. Some traders claim that inventory restocking played too muchof a role in driving GDP higher and this pace may not be maintained moving forward.Some traders also believe that new government austerity measures are likely tolimit gains in GDP during the next quarter.
Technically the British Pound is trading lower but in themiddle of nowhere on the chart. On the upside, a downtrending Gann angle at 1.5697is a potential near-term upside target. Looking at the downside, a move through1.5371 could trigger an acceleration to the downside.