FX.co ★ Technical analysis and trading recommendations on EUR/USD & GBP/USD for February 25, 2015

EUR/USD

The euro has moved marginally higher against the US dollar. Yellen suggests the first rate hike may not happen before the second half of the year. The pair bounced again from the support base. The eurozone approves Greece's proposal. Greece submitted a list of reforms including budget management, tax system revision, fight against corruption, pension system revision, and improvement of Greece's public sector. Finally, Greece managed to make a sound deal. The deal gives way to the four-month bailout extension. Today, traders are keeping an eye on US new home sales, Yellen's testimony, and ECB president Draghi speech. In March, the ECB will start its 1.14 trillion euro bond-buying program.

Technical view

Technically, there is no improvement in the pair. Technically, the pair looks very weak. The prices have a strong support base between 1.1270 and 1.1260. Trading is framed between 1.1450 and 1.1260. In case the pair closes below 1.1260, the new lower target is found at 1.0996. The intraweek support is set between 1.1280 and 1.1260. The panic will be triggered below 1.1260 with the targets at 1.1220 and 1.1190. Until a h4 candle closes above 1.1450, use every rise to sell. The intraday resistance is set at 1.1360 and 1.1370. We can expect strong momentum, in case the pair closes above 1.1535, but the chances are remote. Intraday support is set at 1.1330. We recommend selling below 1.1330 with the targets at 1.1330, 1.1290, and 1.1270.

GBP/USD

Yellen suggests the first rate hike may not happen before the second half of the year. US dollar is still trading higher against most major currencies. The cable slipped 0.30% at yesterday's session. The US consumer confidence index declined in February after increasing in January. The Index now stands at 96.4, down from 103.8 in January. According to Lynn Franco, Director of Economic Indicators at the Conference Board, “After a large gain in January, consumer confidence retreated in February, but still remains at pre-recession levels (September 2007, Index, 99.5). Consumers’ assessment of current conditions remained positive, but short-term expectations declined." Today, traders are focused on BOE Governor Carney speech, Yellen speech, and US new home sales data. Ahead of the testimonies, the cable muted at the early Asian session.

The cable has been facing strong resistance at 1.5480 and the 61.8 fib level. The weekly resistance is at 1.5535 20Wsma. The weekly support is seen between 1.5310 and 1.5260. Bulls can challenge 1.5565, if the price breaches above 1.5490. In case a h4 candle closes above 1.5480, again bulls can challenge towards the new weekly high. The intraday support is found between 1.5440 and 1.5400. The panic will be triggered below 1.5400 with downside targets at 1.5280 and 1.5200. We recommend selling below 1.5400 with the targets at 1.5340, 1.5310, and 1.5280. The prices are consolidating in a tight range between 1.5440 and 1.5475. Bulls can strike towards 1.5535, 1.5550, and 1.5564, in case the level 1.5480 is taken off.

Buying above 1.5480.

Selling below 1.5400.