Today’s Philly Fed manufacturing data came out exceptionally well, as the data printed a result of 26.5 versus the forecast of 11.2. Despite this result, the Dollar has found itself down 0.42%.
As expected, the long-term downtrend for the Dollar has taken rain over any short-term bullish momentum. The DXY has found itself reverting down to the psychological level of 90.00. This may be attributed to the Biden administration taking office, which has been a known precursor for a weaker Dollar. Price action and smart money believe the next target is the low achieved in 2018.
Due to the Dollar respecting the higher time frames and resuming its downtrend, many majors are shaping up for longs. GBPUSD stands out among the others as a prime candidate for an entry long. Currently, price action traders are waiting for a break, retest, and rejection of the current resistance to go long.
From 2:00 AM EST to 10:00 AM, there will be high impact fundamental releases for the Euro, the Pound, and the Dollar. This should stray traders away from trading the majors as much as they can. The silver lining is that these fundamentals may provide more clarity on the trajectory of the majors.
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- Read yesterday’s breakdown: USDCAD Final Target Achieved + GBPUSD Intraday Short