Two trades to watch: EUR/USD, FTSE

EUR/USD in focus ahead of ECB minutes and US retail sales. FTSE points higher amid an improved mood in the market after US Fed officials soothe inflation concerns.

Charts (4)

EUR/USD in focus ahead of ECB minutes and US retail sales

EUR/USD is edging higher after bouncing off a weekly low in the previous session 

The Fed’s insistence that multiple months of high inflation data would be needed to consider tightening policy despite strong CPI & PPI data has helped calm monetary policy tightening expectations. 

ECB policy makers are less concerned about inflation but are now expecting stronger economic growth in 2021 -22 as per the latest forecasts. 

Looking ahead the release of ECB monetary policy meeting minutes will be in focus in addition to US retail sales & Michigan consumer sentiment index. 

Learn more about ECB 

Where next for EUR/USD? 

EUR/USD found support at around 1.2055 the 2 month ascending trendline which is keeping the buyers optimistic of a move towards 1.2175 the monthly high. A break above here could see 1.2240 come into play the late February high. 

On the flip side a break below 1.2055 could see the 100 day ma tested at 1.2030 before bringing the key psychological level of 1.20 into focus. 

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FTSE points higher amid improved mood in the market

European bourses are pointing to a stronger start following a positive close on Wall Street after US Federal Reserve officials soothed inflation fears. 

The Fed have been out in force reassuring that the price pressures seen in multi year high inflation numbers are transitory. 

Rickett Benckiser could be in focus on news that it has been shortlisted to submit a binding offer for its infant formula business in China. 

Commodity stocks could come under pressure as base metals & oil extend declines. 

Learn more about the FTSE 

Where next for the FTSE? 

The FTSE found support around 6820 zone after having slipping through its 200 sma on the 4 hour chart and the multi-month ascending trendline. However, the index rebounded retaking these levels. The index currently trades caught between the 50 & 100 sma  

Buyers will be looking for a move above the 50 sma at 7020, opening the door to a move towards resistance at 7040. A break higher here could see the buyers gain traction. 

On the downside, the 200 sma and the ascending trendline could offer support. It would take a move below 6820 to negate the current uptrend and for the sellers to pick up pace.  

Learn more about trading indices 

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