Trade ideas thread - European session 10 May 2021

Author: Justin Low | Category: News

Daily thread to exchange ideas and to share your thoughts

The pound is the lead gainer to start the week as GBP/USD breaks 1.4000 to its highest levels since 25 February, clearing a key technical resistance hurdle at the figure level.

While there were worries going into the UK local elections, they have been quickly phased out despite Nicola Sturgeon vowing to push for a second Scottish independence referendum - which will surely not be entertained by the folks at Westminster.

Meanwhile, the dollar is keeping little changed today after having suffered a beating on Friday amid a rather poor non-farm payrolls figure.

As much as I would like to stick with the argument that the rethink in the bond market will also help culminate in a dollar bounce, the technicals are a tough one to fight at the moment - with EUR/USD breaching the broken resistance trendline for the year again.

The pair now trades up to 1.2155 - its highest levels since February as well.

Elsewhere, AUD/USD has also broken back above 0.7800 and looks to try and hold a push above the 18 March high @ 0.7849 in order to target 0.8000 again.

In any case, the Friday jobs report doesn't really change things all too much as it is a blip in the data for now. The dollar may be still continue with a bit of a hangover due to technical plays but other key trade potentials are still playing out as they should.

The loonie remains very much favoured in this environment and longs against the yen and dollar are still playing out nicely. Other than that, what's there not to like with stocks? Again, just think Goldilocks and dips should be bought into.

There's still the prospect of a deeper correction in the latter but if you're taking a long-term view, that's yet another opportunity to scale into longs.

What are your views on the market right now? Share your thoughts/ideas with the ForexLive community here.

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