Our suggestions: From a technical standpoint, there’s a strong chance of a rally being seen from the current H4 today, possibly back up to the 1.25 handle. The only grumble our desk has noted is the fact that we have little weekly confluence supporting this trade. In fact, from the weekly chart, one can see just how strong the bears have been since June 2014!
Despite this, the H4 buying tail indicates that there are willing buyers around the H4 , and therefore, we have taken a long position at 1.2423 and placed our stop at 1.2382: beneath the tail of the H4 candle. The first take-profit target is set around 1.25, followed closely by the H4 supply above it at 1.2525-1.2557, which, as we explained in yesterday’s report, is also a nice-looking zone to sell from due to its converging H4 structures.
Data points to consider: MPC member Forbes speaks at 11.30am, UK Autumn forecast statement at 12.30pm. US Core durable goods data at 1.30pm, US Jobless claims also at 1.30pm, FOMC meeting minutes at 7pm GMT .