EURUSD: We are getting to the point where we can officially say that they Euro rally is over. If there was the official point where we can “stick the fork into it” it will occur if the EURUSD breaks below 1.2550 (see chart). This level was the EURUSD’s initial post spike support level on Friday morning. The pair again bounced off this level yesterday. However, as the EURUSD has been failing to trade to any higher highs since Friday, it will be vulnerable to selling pressure if the 1.2550 figure fails to hold. The lack of follow through momentum in the Euro contrasts to the GBPUSD and AUDUSD which are both holding their risk rally gains of the last few days.
GBPUSD: The GBPUSD continues to see demand as support for the pair has risen to 1.5665. However, as seen by the chart below, the pair is seeing resistance on moves above 1.5700. As such, we appear to be in a consolidation phase as the GBPUSD gets ready for its next move. Looking ahead, before getting too bullish for the GBPUSD we would want to see first the pair trade again above 1.5700 and hold that level for the rest of the day.
Holiday Trading: Important Reminder, tomorrow, Wednesday is July 4th Independence Day holiday in the US. Forex trading will remain open by volumes are expected to be lower due to fewer trading participants. Typically, lower volumes will either lead to decreased volatility. But, if important news does hit the wires, it could also lead to sharp spikes as less volumes will be needed to move the marke