Comments on the pound and euro from JPMorgan:
Yesterday's GBP/USD decisive break below Fib.-support at 1.5648 (minor 38.2 %) suggests that we are dealing with a broader setback to at least 1.5496/54 (daily trend/300 DMA) and to 1.5350 (minor 76.4 %), notes JPMorgan.
"The latter is the next decisive T-zone where the decision is due whether we are only dealing with a minor 2nd wave setback or with one of higher scale to 1.4951/1.4887 (pivot/76.4 % on higher scale),"JPM adds.
"On the upside and in order to start questioning this negative view again, it would take a break above 1.5740 (hourly trend)," JPM projects.
Turning to EUR/USD, JPM notes that since we marked the 1.1278 high on Monday, the market kept on drifting off and is has already reached key-Fib.- support at 1.1031 (minor 76.4 %), where we'll receive the final hint what we are actually dealing with.
"We are now watching the first T-junction at 1.1031 (minor 76.4 %) closely, which is going to determine whether the door for a broader recovery to 1.1699/1.1811 (int. 38.2 % on higher scales) remains open, or whether we have to be prepared for a deeper setback to at least 1.0744/1.0692 (int. 76.4 % on higher scale/daily trend)," JPM clarifies.
"Only a break below the latter would resume the long-term downtrend towards 1.0072 (76.4 %) though," JPM argues.
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