Trading Forex and CFDs is risky

German Ifo surprises EURGBP to 9000 and even 9100

Market Analysis

EURGBP, Daily                    

The German July Ifo index unexpectedly jumped to 116.0 from 115.2. Expectations had been for a slight correction in the headline reading, especially after yesterday’s disappointing PMI readings, but in the event the Ifo reading was a positive surprise, sending Bund futures further down. Still, the breakdown showed that the overall improvement was entirely due to a sharp rise in the current conditions indicator, while the more forward looking expectations index stagnated. So the message is not unlike that of the PMIs, which showed ongoing robust growth, but a slowdown in the pace of expansion. Still, the recovery clearly remains intact, tying in with Mersch’s increasingly optimistic message on the Eurozone economy, which the ECB is now more optimistic will also bring inflation back to target.

I opened a long position on the EURGBP at 0.8932 with target 1 at the recent fractal high and psychological 0.9002, target 2 is another psychological round number and October 2016 high at 0.9100. Expectations are for a well bid EUR as we run through the summer.  A break down through the 20 day moving average and a sustained move in the lower half of the Bollinger band will negate the move higher. RSI is positive (61) and rising and the parabolic SAR remains positive.  There may be some be some further retrace from my entry, of Thursdays (July 20) strong up candle, but sentiment remains EUR positive.

 

Click here to access the HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! The next webinar will start in:

Stuart Cowell

Senior Market Analyst

HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Risk Warning: Trading leveraged products such as Forex and CFDs may not be suitable for all investors as they carry a high degree of risk to your capital. Please read the full Risk Disclosure.

Risk Warning: Remember Forex and CFDs are leveraged products and can result in the loss of all invested capital. Please consider our Risk Disclosure.