GBP/USD looking to test lows

GBP/USD has continued drifting while EUR/USD has maintained its lateral move. 

A pound coin on top a dollar note
Source: Bloomberg

GBP/USD traders eye UK PMI data

Looking at the way that GBP/USD has been trading over the last week, it looks destined to break below $1.5000 and set some fresh lows for the year.

Even with last week’s comments from the Federal Open Market committee, expectations regarding a rush to raise interest rates have failed to garner any optimism. Currency traders will be conscious of tomorrow’s UK services PMI figures and the importance of this sector to the UK economy will ensure a move in GBP/USD one way or another.

The pre-market open blip down to $1.4989 matched last Friday’s lows, but the near-term pressure of the 50-hour moving average should ensure that lower lows are seen at some point over the course of the day.

Euro traders monitoring Greek situation

Greek finance minister Yanis Varoufakis will continue his European road trip today trying to pick up friends as he goes from country to country. Judging by his attire when meeting George Osborne yesterday he is definitely trying to keep all of these meetings ‘casual’.

As successful as this might be in gaining support from the peripheries the charm offensive ultimately will be doomed to fail if he is unable to get German finance minister Wolfgang Schauble and German chancellor Angela Merkel on board. Considering their reluctance to meet directly with him this does not look likely.

Considering the backdrop of news surrounding the eurozone it is difficult to get too enthusiastic about it, but the last week’s lateral move in EUR/USD has shown the bear trend in the short term has become a little exhaustive.

Traders are continuing to monitor comments from the Greek government in order to gauge where the next directional move will come from. Looking at the hourly chart, the support that both the 50- and 100-hour moving averages has been offering looks like it is about to give in.

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