26.10.202009:19 Forex Analysis & Reviews: Analysis and trading recommendations for the EUR/USD and GBP/USD pairs on October 26

Analysis of transactions in the EUR / USD pair

Strong manufacturing activity in the largest eurozone countries has restored traders' confidence on Europe's economic recovery. As a result, the euro moved 50 pips up from 1.1813, reaching the target price level of 1.1864.

Trading recommendations for October 26

Ifo will release economic assessments on Germany today, which may affect the direction of the euro in the market. If the reports turn out to be better than the forecasts of economists, the recovery and upward movement of the EUR / USD pair will continue.

• Open a long position when the euro reaches a quote of 1.1860 (green line on the chart), and then take profit at the level of 1.1915. However, this will only be possible if the Ifo releases very good economic assessments.
• Open a short position when the euro reaches a quote of 1.1824 (red line on the chart, and then take profit around the level of 1.1765. If the indicators turn out to be worse than the forecasts, pressure on the European currency will return.

Analysis of transactions in the GBP / USD pair

The bulls tried to raise the rate of the pound last Friday morning, however, the quote was only able to move 20-25 pips upward. At the same time, short positions were unprofitable as well in the afternoon, since the quote only moved 20 pips down in the market.

Trading recommendations for October 26

Since there are no economic reports scheduled for release today, the attention of traders will be shifted on the next round of negotiations between the UK and the EU over the long-disputed post-Brexit trade deal. Good news about it will lead to a new wave of growth on the British pound, whereas a bad news could lead to another decline in the GBP / USD pair.

• Open a long position when the pound reaches a quote of 1.3045 (green line on the chart), and then take profit around the level of 1.3104 (thicker green line on the chart).
• Open a short position when the pound reaches a quote of 1.3016 (red line on the chart), and then take profit at least at the level of 1.2967. Bad news on Brexit will resume the downward trend in the GBP/USD pair.