Two trades to watch: EUR/GBP, Gold

EUR/GBP steady after mixed UK labour markeet data. Gold looks to US CPI for direction.

Charts (6)

EUR/GBP steady after mixed labour market data 

UK unemployment fell to 4.6% in the three months to July, down from 4.7% as British employers added a record 241,000 staff to their payrolls amid an August hiring spree.  

However, the claimant count fell by a less than expected -58.6k, vs 71.7k forecast. 

The data has failed to provide much impetus to the Pound.  

Learn more about the Pound

Where next for EUR/GBP? 

EURGBP has traded quietly over the past few sessions in a familiar range. The pair has traded in a holding pattern capped on the upside by 0.86 and on the lower side by 0.8530.  

Traders could look for a breakout of the holding pattern. The bearish cross over on the MACD suggests that the break could be to the downside. A close below 0.8530 could spark a deeper selloff to support zone 0.8510/0.8500 the July low and September low. Beyond here bears to look to target 0.8455 the August low. 

Any recovery in the price would need to first clear the 50 sma at 0.8545 and the 100 sma at 0.8577. Only once these are cleared is a break above 0.86 and out of the holding pattern possible, 


Gold awaits US CPI data 

Gold is holding steady and has traded within a familiar range over the past week. Whilst Delta covid concerns have acted as a tailwind these have been offset by hawkish Fed official comments. 

All eyes are on the US CPI data later today which is expected to reveal that inflation ticked lower to 5.3% in August, but remained at decade highs. Core CPIA is expected to remain high at 4.2% down from 4.3%. A stronger than forecast reading is like to boost bets of the Fed moving sooner to tighten policy. 

Learn more about trading gold

Where next for Gold prices? 

The pullback from resistance at 1832 and the repeated failure to retake 1800 is supportive of the bears. However, over the past week gold has been trading in a holding pattern, showing indecision among traders, capped on the lower side by 1782 and the upper band by 1803. The RSI is also neutral. 

Traders could look for a breakout trade here. The buyers might wait for a move above 1803 to test 1823 the August high ahead of 1832 the September high. 

Sellers could look for a break below 1783, which could open the door to 1775 the late August low and a deeper move to 1750. Beyond 1750 losses could extend to 1720. 

How to trade with

Follow these easy steps to start trading with today:

  1. Open a account, or log-in if you’re already a customer.
  2. Search for the market you want to trade in our award-winning platform.
  3. Choose your position and size, and your stop and limit levels.
  4. Place the trade.

More from Trade Ideas

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.