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The US dollar is still having a hard time due to speculators who open trade deals in favor of the euro and the pound.
On Tuesday, the UK's labor market was published. The unemployment rate continues to rise to 5.1%, while employment declined by 114 thousand. At the same time, the wages are growing from 3.6% to 4.1% due to large-scale layoffs of low-paid employees.
The situation in Britain is worse than ever, however, speculators do not pay attention to the economic problems inside the country. The media forced them into a different reality, in which everything is fine and quarantine measures will be lifted soon.
Europe, in turn, published its inflation data, which confirmed its rapid growth to 0.9% after staying at the deflation level for too long.
The market did not react when inflation data in the EU was released, since the quote already took into account the data.
On the other hand, the United States published the composite housing price index (S&P/CS Composite-20) for December, where there was growth from 9.2% to 10.1%. However, the market ignored the positive statistics.
What happened on the trading chart?
The EUR/USD pair continues to try to reverse the correction course from the peak of the medium-term trend of 1.2349 - - - > 1.1950, where the important indicator of 1.2190 was reached. The breakdown of this level may lead to a change in trading interests and a recovery relative to the correction course.
The GBP/USD pair continues to update the local high of the mid-term trend, where the breakdown of the important resistance area of 1.3950/1.4000/1.4050 has occurred. Such a sharp growth can only be justified by the speculative behavior of market participants, since all other signals indicate the quote's early reversal.
Trading recommendations on EUR/USD and GBP/USD for February 24, 2021
Today, the United States will release its new home sales data, where it was predicted to rise from 1.6% to 2.1%. The expected data is positive, but speculators are unlikely to be interested in them.
Analyzing the trading chart of EUR/USD, it can be seen that the quote slightly slowed down its upward trend, forming a stagnation within the coordinate 1.2150. To confirm the signal of the restoration of the upward course relative to the corrective one, market participants need to hold above 1.2200 in the H4 time frame, with the prospect of moving to 1.2095-1.2050.
As for the trading chart of GBP/USD, there was a speculative price surge during the Asian session, which led to a rise of 100 points. Such strong price fluctuations in a low-liquid period of time confirmed speculators' theory of price manipulation once again.
In this situation, we can assume that there will be an impending correction due to the overheated long positions and overbought pound. However, some speculators are persistent.
To simply put it, speculators who ignore the economic problems from the UK can continue to reset the high in the direction of the peak of 2018 – the area of 1.4350.
In this case, it is necessary to closely monitor the high of 1.4224. Speculators will continue its manipulations until this level is broken through.
At the same time, we are currently in a situation where a massive correction can happen at any time. Therefore, the quotes should stay below the level of 1.4140, which will open the way towards the 1.4000-1.4050 range.
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