European Day Trade for 16 February 2022
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Cable rejected the dip below 1.3500 yesterday, recovering to retake 1.3560. Provided that the GBP can maintain this upside momentum, expect another attempt at 1.3600/10.
Failure to make further gains above the 1.3560 pivot would see a return to support at 1.3500 possibly 1.3450.
The JPY has lost some of its safe haven attraction, as the Russia/Ukraine tension seems to be lifting. The USD has tried to take out 115.80, although so far not successfully. If it does break here, then you will see further dollar appreciation to 116.20/30.
While below 115.80 the risk remains for more consolidation and a drop to the bottom of the trading range at 115.20/10.
The single currency stabilised after its drop sub 1.1300, to recover back above 1.1340, and then hit our target resistance this morning at 1.1380.
As long as the EURUSD can maintain the upside momentum you will see a test of 1.1420. This would be a positive for the EURUSD, and suggest more upside potential to come.
Failure to make further progress will see a drop back first to 1.1340/30 and possibly a deeper drop to 1.1290/80.
Gold got hit by the news that some Russian troops were being withdrawn from the boarders of Ukraine and Belarus, much to the relief to the markets and reducing the need to hold safe haven trades.
While it is far from clear that the threat of war has totally disappeared, there is still support to buy Gold this morning at 1852/1850 and again at 1844.
Immediate resistance is found at 1860/62 and 1870.
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