EURUSD and GBPUSD: Bullish Spree

• During the Asian trading session, the euro was on a bullish spree, rising from the 1.00000 level to the 1.01000 level.
• During the Asian trading session, the pound went on a strong bullish impulse up to the 1.16500 level and thus formed a new higher high and the previous September maximum.
• China’s consumer price inflation slowed in August.

EURUSD chart analysis

During the Asian trading session, the euro was on a bullish spree, rising from the 1.00000 level to the 1.01000 level. During the European trading session, we encountered resistance at that level and saw an immediate pullback to the 1.00780 level. For now, the 1.01000 level represents an obstacle to the bullish trend. We need a negative consolidation and pullback to the 1.00500 level for a bearish option. If the euro does not find support at that level as well, the pair could drop again to the 1.00000 level. At that point, the euro could form a new higher low. A break below could further lower the EURUSD. Potential lower targets 0.99500 and 0.99000 levels. We need a positive consolidation and a new break above the 1.01000 level for a bullish option. Potential higher targets are 1.01500 and 1.02000 levels.

GBPUSD chart analysis

During the Asian trading session, the pound went on a strong bullish impulse up to the 1.16500 level and thus formed a new higher high and the previous September maximum. We are now in a pullback to the 1.16000 level and are looking to see if the pound will form a higher low or continue to slide down. At the 1.15600 level, we have additional support in the MA200 and MA50 moving averages. If the pound weakens, we will return to the support zone at the 1.15000 level. For a bullish option, we need a positive consolidation and to go back above the 1.16000 level once again. If we manage to stay above, we will have a chance to continue the bullish trend. Potential higher targets are 1.16500 and 1.17000 levels.

Market Overview

China’s consumer price inflation slowed in August, and factory inflation fell to an 18-month low, giving the central bank room to ease its monetary policy to support the economy. According to data released by the National Bureau of Statistics, consumer price inflation eased to 2.5% in August from 2.7% in July. Economists expect consumer price inflation to remain below the central bank’s upper limit of 3 %.