Forex News: Yesterday the pair made a sharp turn after edging above 1.1310 resistance, and overall we had a bearish day. Fed Chair Yellen’s testimony brought some bearish price action after she mentioned that economy is in many ways close to normal.
The move below 1.1200 is likely to extend into the 50 period Exponential Moving Average and possibly into 1.1110. The Relative Strength Index and the Stochastic are both moving out of overbought, coming down and increasing the chances of a stronger move to the downside but the overall trend is bullish so a quick move and a close of a full candle above 1.1210 would invalidate a bearish scenario.
Fed Chair Yellen will testify again today at 3:00 pm GMT on the Semi-annual Monetary Policy Report but this time before the Senate Banking Committee. As always, this type of speeches and Q&A sessions should be treated with caution because a strong impact on the markets is possible.
Also today the Eurogroup Meetings take place and although these are closed to the press, sometimes participants talk to journalists during the day, generating increased volatility. Once the meetings have concluded, a formal statement will be made.
The British Manufacturing Production showed a lower value than anticipated but still better than the previous and the Pound made another run for 1.4565. However, resistance was not broken and the pair bounced lower.
Although the pair moved higher yesterday, the bulls failed to break the resistance at 1.4565 and now price is close to the minor support at 1.4475. Neither side is in clear control at the moment and probably the next direction will be decided by a break of either 1.4475 or 1.4565. The oscillators don’t show a lot of momentum and are not in extreme territory so they paint a blurry picture too, suggesting that it would be safe to wait for a clear breakout.
The Pound is not affected by major indicator releases today so the main focus will be Fed Chair Yellen’s testimony and the technical aspect.