GBPUSD: Volatility forecast for October 22th 2010

Market Leader informed

The downtrend of the British Pound, started last Friday, has slowed down as the market participants are perplexed with contradictory events: China has raised its interest rate; there is a chance that the Bank of Japan may continue market interventions; G20 meeting is to be held soon. US Secretary of the Treasury Timothy Franz Geithner indicated the reluctance to devalue USD. Yesterday the downward movement of GBPUSD was sluggish and ambiguous. On its way down GBPUSD has an important option barrier at 1.5700. If the price crosses and settles below it the next support level is 1.5600. The uptrend is restrained with 1.5900 (an option level).
Today’s volatility of GBPUSD (Oct 22nd) will be conditioned mostly by the news on the EU as today GB offers no news. At 8.00 GMT Germany releases IFO - Business Climate, reflecting the sentiments of Germany’s major manufacturing, construction and wholesale companies for the next 6 months.
Today’s key event is G20 meeting. The 20 finance ministers of the Group are going to announce that the participants will abstain from the “competitive underestimation” of their national currencies in efforts to reduce the tension in the trading relations before it shatters the global economy. An unnamed leaker from G20 says that after the end of the talks in South Korea (on Oct 23rd) the finance ministers and the heads of central banks are going to announce that they want a more “clear” system of currency rates, which will minimize the negative consequences of excessive volatility and chaotic currency movements.

How will it affect the currency market?

Based on the materials provided by the Department of Options, Masterforex-V Academy.



You can read this article here: Market Leader
You are free to discuss this article here:   forum for traders and investors