GBP/USD 1hr chart:
As we observe from the chart above; I was right to take profits this morning at the lows of the day as the major "risk-on" currencies once again attracted buyers at these levels. My bearish view has now changed on Cable as a result and I have placed a Buy order ahead of the 50% retracement level from today's rally, with a fairly tight stop. For similar reasons I am buying the EUR/USD pair below except this pair is not as over bought as GBP/USD in my opinion.
EUR/USD Daily chart.
I have entered a long position in the EUR/USD pair following another steep rejection today of the lows seen at the foot of the recent trading range around 1.3030-80. The pair have had numerous excuses to trade lower on the back of renewed concerns over the situation in Europe as well as a perceived reduction in dovish expectations with regard to Fed policy. However, despite attempts to break out to the downside, buyers have persisted in supporting the pair at these levels. I will be looking to see if we can use this short-term momentum to break the 1.32 barrier this week which would provide an good opportunity to add to this position. Alternatively my stop is positioned at the lows of today to take advantage of any loss in momentum/ fundamentally driven sell off.
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