The EURGBP is major cross-currency pair that rose sharply this week. With the ECB meeting ahead next week, understanding the technical levels in play could open the door for trading opportunities.

Technically as well, the market traders have used the technicals on the extremes to define support and resistance, and the correction off the high this week, has seen a swing level/area do a good job of holding support.

Looking at the 4-hour chart below, the pair on Monday and Tuesday based at the 100/200 MA. The basing at the level, gave the buyers the go ahead to push higher. On Wednesday and Thursday, the price raced higher but found resistance sellers against the 100 day MA at 0.8701. The highs got within a couple pips of those highs this week.

The subsequent move lower saw the pair move down below the 38.2% retracement at 0.86455, but held support near a swing area near 0.86357. That level./area between 0.86357 and 0.8655 will be a key barometer in the new trading week. Stay above is more bullish. Move below would increase the bearish bias once again.

For more details, watch the video above.

This article was written by Greg Michalowski at www.forexlive.com.

WTI crude oil has been flirting with the 200-day moving average all week and finally had a look above it, rising to $77.29. However it wasn’t able to break the weekly high of $77.32 and has backtracked slightly to $77.06.

In all, I wouldn’t be comfortable calling that a technical break but it sets up next week to be an interesting moment in the crude oil market. We should hear soon about Saudi plans on whether to extend voluntary cuts through September so that could be the headline that does it. If not, the market will be looking carefully at US inventory data in the hope that summer inventory draws will pick up.

This article was written by Adam Button at www.forexlive.com.

I have showed this chart before because it shows how the CPI chart laps some very easy comps soon.

What has emerged, pointed out by Omair Sharif, is that the numbers used on the chart are non-seasonally adjusted, which isn’t what is commonly (universally, frankly) used for the m/m CPI numbers.

What it showed was that even if CPI ran at 0.2% m/m until January, the year-over-year reading would rise to 3.9%.

This is problematic for two reasons:

1) If you use the standard seasonally-adjusted numbers, a 0.2% m/m reading would get CPI back to 2.5% in January.

2) If you insist on using non-seasonally-adjusted numbers, there’s a strong downward bias late in the year (because price hikes are usually done at the turn of the year).

Here is what the chart (by Preston Caldwell) shows if re-done for the standard seasonally-ajdusted numbers.

By that measure, a 0.2% m/m reading would be fine for getting CPI on track, especially considering that in March of 2024, the y/y comps begin to get easier.

The takeaway here is that we’re closer to 2% than it seems and it’s what the market is implying. That could change if the combo of housing, commodity prices and wages pickup but a 0.2% SA m/m reading is a fine baseline with what we know about the economy.

This article was written by Adam Button at www.forexlive.com.