Broken out of the triangle formation to the downside. Continued downward momentum from 137.79 resulted in the pair posting net daily losses yesterday. There is scope for mild buying at the open but gains should be limited. We look for a re-test of the upward trending resistance. We have a 61.8% Fibonacci pullback level of 136.79 from 137.79 to 135.17. Further downside is expected although we prefer to set shorts at our bespoke resistance levels at 136.75, resulting in improved risk/reward.
We look to Sell at 136.75 Stop: 137.15 Target 1: 135.70 Target 2: 135.20
Trade ideas & daily market report July 9th 2019
Market highlights
Reduced expectations of aggressive Fed easing continued to support the US currency during Monday, although ranges were narrow.
Equity markets lost ground as expectations of aggressive Fed rate cuts declined further.
Demand for the yen and Swiss franc weakened slightly as US bond yields edged higher with the Euro also unable to make headway.
Gold prices also declined as bond yields increased and the dollar maintained a firm tone.
Oil prices gained some support from Iran tensions, but failed to hold gains.
Commodity currencies were unable to make headway amid a solid US currency tone with Sterling also losing ground.
Bitcoin pushed above $12,000 which helped trigger further buying.