European stocks opened lower this morning after the negative closure in the US, where S&P 500 lost more than 2% and NASDAQ almost 3%. The red closure came after the US data regarding consumer confidence dropped to its lowest level since February 2021 (data released at 98.7 against a forecast of 100.4).
Today, investors’ eyes will be on Sintra Forum, where the three central bankers Lagarde (ECB), Powell (FED) and Bailey (BoE), will hold a panel on the current economic situation. They will discuss how to deal with the need to decrease inflation and, at the same time, ensure soft lending for the economy.
Elsewhere, China lifted some restrictions related to its “Zero Covid-19” policy, decreasing some of the quarantine requirements for inbound passengers in what could be seen as the most significant relaxation of measures so far.
Regarding the macroeconomic calendar, today will be a busy day. Apart from the already mentioned central bankers’ speeches, US GDP data will be released this afternoon as the Crude Oil Inventories.
The EURUSD collapsed yesterday during the US session, and once the pair broke the intraday support area around the W-1 VAH, the movement was really quick. The pair is currently trading not only below the current weekly Value Area but also below the W-1 Value Area, which could be considered a negative bias for today. From a technical point of view, the most important intraday support is the W-2 VAH: if prices fail to hold this area, a further drop is expected until around the 1.0453 mark. On the other hand, a reversal of the current short-term short trend could only occur if the exchange rate manages to recover the main intraday resistance area, which is between the current VAL and the W-1 POC. In that case, the pair could target higher resistances around the W-1 VAH and eventually return to the medium-term resistance area around the yearly LVN.
Main intraday support areas where to look for long trades in case of bullish candlestick pattern or short trades in case of bearish candlestick pattern: 1.0492, 1.0453.
Main intraday resistances areas where to look for short trades in case of bearish candlestick pattern or long trades in case of bullish candlestick pattern: 1.0509, 1.0536, 1.0562.
The Cable followed the move of the EUUSD, trading below the current and past weekly Value Area, which can be considered a negative bias for today. The pair seems to find support around the main intraday support area, the W-2 POC, where it posted a double bottom pattern. However, this pattern could reverse the current short trend only if the GBPUSD can break the main intraday resistance area around the current weekly VAL. In that case, a reverse to target the 1.2237 mark first and the 1.2256 mark is expected. On the other hand, if the pair fails to hold the main support, another drop until around the uncovered daily POC at 1.2146 is expected.
Main intraday support areas where to look for long trades in case of bullish candlestick pattern or short trades in case of bearish candlestick pattern: 1.2173, 1.2146.
Main intraday resistances areas where to look for short trades in case of bearish candlestick pattern or long trades in case of bullish candlestick pattern: 1.2212, 1.2237.