EURGBP has reached and is holding important support around .7250, with a number of technical indicators looking for a move at least back to .7410-.7475, as analysts at Lloyds Bank noted.
After the European data showed deflation in Europe is slowing its pace we believe that the move in EURGBP could still come via GBPUSD. A break of 1.5345/25 should trigger that move to the 1.5200/1.15180 and 1.5100/1.5080 Fibonacci stepping stone supports ahead of the 1.4950 lows.
RBA and BoC
The RBA Semi surprised by leaving rates on hold overnight, which has forced the AUDUSD back into the midst of the recent range. The BoC is next and the contracting range price action in USDCAD over the last month or so is ripe for a breakout. Historically this pattern would break to the topside in the direction of trend, targeting new highs above 1.3065. However, we are a little hesitant after recent comments by Gov. Poloz, suggesting they may not cut and so wouldn’t fight a breakdown through 1.2350/45 technical support as it would potentially open a move towards the 1.2200 area before then trying to develop another higher low.
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