Forex Today – Three Stories to Watch

GBPUSD Breakout Continues?
USDJPY Below 81.00
AUDUSD Falls on CPI – Poised to Recover?

GBPUSD Breakout Continues?


If you haven’t been watching the GBPUSD, than you may have missed a pretty impressive move higher in the pair.  The GBPUSD was stuck in a trading range between 1.56 and 1.60 for about two months.  However, earlier this month, the pair started to show a buildup of demand at 1.5800.  Since then, the combination of hawkish comments from the Bank of England as well as better than expected UK employment data has helped send the GBPUSD above 1.6000.  More importantly, after trading above its upper 1.6000 resistance, demand in the GBPUSD rose to 1.6000 to support the pair at that level.  Currently, support continues to rise, with any trading yesterday below 1.6100 being brief. As such, this brings us to today’s trading, where a move above last week’s resistance of 1.6150 could trigger a continuation of the GBPSUD’s breakout and put 1.6250 in play.

USDJPY Below 81.00


If you’ve been watching the USDJPY’s trading action of late, you will notice that it’s been trading pretty choppily during the US & European sessions, while having a trend during the Asian session.  This makes sense, as Japanese firms are the biggest movers and shakers of the currency.  Currently, their direction has been to sell the USDJPY, with the pair clearly moving lower during the Japanese sessions.  As such, this seems to indicate that Japanese firms are taking a cautious view of the global economy and at this point are rotating cash back towards Japan.  For Forex traders, this currently means watching the 81.00 level.  If this figure holds during the European and US sessions, it will reveal that the downward momentum in the USDJPY remains intact and could set up a move towards 80.00 during the Asian session when Japanese Forex traders come back on board.

AUDUSD Falls on CPI – Poised to Recover?

Out of the EU, the big story so far this week was a much worse than expected CPI reading from Australia.  Forex traders were expecting a 0.7% figure, while the actual number came in at 0.1%.  As a result, the AUDUSD fell to a low of 1.0247 following the news, from a pre-news level of 1.0320.  However, in morning trading, the US dollar has been seeing selling pressure, which could be related to Forex traders trimming their dollar holdings before tomorrow’s FOMC Meeting.  As such, even with the poor Australian economic news, the AUDUSD could be turnaround candidate and erase all of its overnight weakness.