Markets love numbers that are round! These numbers are psychological markers that can trigger strong price reactions and headlines. These levels can also be decisive areas for technical support or resistance. There are usually 1000s of orders that buy and sell in these critical areas.
The current dollar slide has seen the world’s reserve currency fall over 4% from its early March peak. Two of the most popular majors have also been affected by this trend, and both have seen significant increases in round numbers. EUR/USD has taken 1.10 while GBP/USD advanced to 1.25 this morning in early trade.
This move must be confirmed north by closing decisively at the 1.1032 level, which is the highest point for the year. The trend oscillators show that the move has legs across different timeframes. Cable bulls aim to achieve a weekly close above the April peak of 1.2525 for further upside.
These moves come after two big risk events on yesterday’s calendar which has prompted dollar driven selling over any major strength in either the euro or sterling. The Fed has been increasingly seen as…