Euro regained above 1.4000 after Goldman Sachs put out a buy recommendation and the USD weakened after traders pared back bets of the US Fed raising rates this year. German Industrial Production was down -1.9% in April vs. 0.0% forecast. Looking ahead, May German CPI is forecast at -0.1%. Sterling continued the rally that began yesterday on route back above 1.6300 towards year highs above 1.66. Better than expected RICS house price balance helped propel the pair with gains above 1% for the day. Industrial Output is forecast at -0.1% vs. 0.0%. Also released, April Trade balance is forecast at -6.4Bn vs. -6.59Bn.
Technical Outlook:
EURO chart pattern is expected to be on a bullish note for the day. Currency is expected to trade in the range of 1.3950-1.4180 levels. Daily Momentum and stochastic are seen trending up and Euro is trading above the moving average giving a bullish outlook but Parabolic is still holding on the bear note. Good support is seen at 1.3920 break of which will see 1.3850 and key resistance is seen at1.4220 levels .
GBP chart pattern is expected to form a bullish pattern and trade in the range of 1.6130-1.6430 levels for the day. Momentum is seen trending up and the Relative strength index is also trending up hinting towards upward correction to 1.6450 .Key support for the currency is seen at 1.6080 levels.
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