Forex Technical Analysis

The second half of the European session brings a strong reversal on the Euro, which has its roots in the dovish words from ECB Lagarde. This reversal can have very strong technical implications, for example on our today’s hero – EURGBP, where the situation on the chart is extremely interesting.

This week was crucial for the USD as the FOMC Minutes showed that, most probably, the times of chunky hikes are over. The USD was not, however, the only important topic. Some instruments made important moves that changed the optics and gave promising, long-term trading signals this week. One of the examples is the hero of the day – GBPCAD.

The Thanksgiving Day brings us bigger correction on the American Dollar. Although it has been some time since it started, the correction definitely accelerated this week, especially after yesterday's FOMC Meeting Minutes. Minutes were dovish as officials expressed their willingness not to use big hikes in the near future. They also noted a possible negative impact of higher rates on the economy.

Overnight RBNZ made a decision to increase interest rates by 75bp, which drove the rates to the levels unseen since 2008. Along with this decision, we received bullish comments in the statement and during the press conference – we should thus not be surprised that NZD is currently trading higher. In today’s analysis, we will focus on the NZDUSD, where we are one small step from a major buy signal.

It is a fairly quiet day on the market at the moment with almost an empty calendar and major indices and currency pairs going pretty much sideways. We have to look for trading occasions elsewhere, but we have found a very promising setup on the NZDCHF. The fact that this is an exotic instrument does not make this setup worse or of bad quality - quite the opposite, price action here is very promising!

In the past few weeks, one of the most technical moves can be seen on the exotic pair of GBPNZD. Currently, we are in the sideways trend, without a proper signal but this should end soon and hopefully, we will be pleased by a new, mid-term, proper trading opportunity.