EUR/USD trades at 1.1561, the low today is at 1.1558
But the range remains rather narrow still with the daily range so far being only 22 pips. The focus on trading today will be more skewed towards the Bank of England meeting and the trade rhetoric. So, for EUR/USD the latter would be the more prominent driver of direction.
The market seems to be taking the trade rhetoric between US and China in good stride still, as there is no further evidence of major risk-off tones after the one we saw on Tuesday. The relative calm has been helping to steady the euro a little (less flows into the dollar) despite Nowotny's attempt to jawbone it lower yesterday.
But if we look at the chart, sellers in EUR/USD are still in control of the pair. Overnight moves failed to clear the 100-hour MA (red line) as well as the 1.1600 handle, and that says that the near-term bias in the pair remains bearish. Although, any move to the downside remains limited unless it is able to sustain a firm break below Friday's low at 1.1543.
However, in trading today if we observe yet another lull in the trade rhetoric I'd expect the pair to hover between 1.1550 to 1.1600 levels for the most part considering that the pair is layered with large expiries today between 1.1525 and 1.1625.
In any case, the trade on either side remains clear as well. For buyers, a break of the 100-hour MA @ 1.1589 and the 1.1600 needs to be seen before an extension higher. For sellers, a break of the 1.1543 level is needed to re-test the lows this year @ 1.1510 before any further move lower.
If not, range away.
