FX News – August 12: GBP/USD, EUR/USD Falls

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Today's trading is expected to be a quiet one, although it should pick up starting tomorrow, Tuesday, with a number of data coming from Germany, the UK, EU, and the US.


The sterling fell against the greenback in today's trading after traders’ lowered appetite for risk compared late last week. The GBP/USD pair fell to 1.5462 in today's session prior to recovering at its current 1.5482 level.

Last week, the GBP rallied against most currencies after BoE Governor Mark Carney announced a forward guidance policy, at least until the country's unemployment rate reaches 7%. On Wednesday, we shall find out if the Monetary Policy Committee provided total support for Mr Carney's policy or not--something that could dictate the GBP's direction in the coming days. Aside from that, traders await several more reports from the UK later this week, including CPI, PPI, RPI, BoE Minutes, and Unemployment Rate.

Initial resistance for the GBP/USD is at 1.5529, followed by 1.5568. Meanwhile, initial support is at 1.5468, followed by 1.5429.

EUR/USD Drops Below 1.3300

As for the EUR/USD, it is currently back to under the 1.3300 level after peaking at almost 1.3400 in the middle of last week. This is despite the increasing possibility of the Fed to start QE tapering in September, which would supposedly help increase the value of the USD.

There are several reports and data to watch out for this week that are relevant to the greenback. These include the Retail Sales for July (Tuesday, August 13), CPI for July (Thursday, August 15), and the Reuters/Michigan Consumer Sentiment Index for August (Friday, August 16). 

The EUR/USD pair is currently trading at 1.3294, with initial resistance seen at 1.3367, followed by 1.3400. Meanwhile, initial support is at 1.3307, followed by 1.3274.

By FX Strategy Team, Published on 12th of August 2013
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