The GBP/USD remains under pressure as of writing after another abysmal economic report – Retail Sales printed at -1.3% vs. 0.0% expected. From a price action perspective, the pair dipped down to a new 2-month low under 1.5100 before recovering briefly in today’s early European trade. Nonetheless, the bias remains clearly to the downside in GBP/USD and we will be watching closely for a chance to sell any Bernanke related bounce into the mid- or upper-1.5100s. Stay tuned to FX360 and our daily Live Market Analysis webinars for any updates or new trade ideas later today.

The USD/JPY rallied overnight following a relatively balanced economic assessment by the Bank of Japan. Unfortunately, the pair did not rally enough to trigger the sell trade from yesterday’s Candlestick Daily report, and the trade has now been cancelled. Moving forward, a confirmed break above 1.0300 would pave the way for a move up toward 1.0400 next, but prudent traders should wait until after Bernanke’s speech, when the near-term direction will be clearer. Stay tuned to FX360 and our daily Live Market Analysis webinars for any updates or new trade ideas later today.

The USD/CHF continues to press against resistance at .9750 and a currently developing price action pattern suggests that a breakout may be imminent. Each pullback off .9750 resistance has been shallower than the previous one, creating a clear Ascending Triangle formation over the past week. Generally, these patterns resolve with a breakout above resistance  and can lead to a strong continuation in the same direction. While there is the danger of Fed President Bernanke’s speech complicating matters today, more aggressive traders may still want to prepare for a bullish breakout.

Specifically, traders could set a stop buy order at .9762 (above this week’s highs) with a stop loss at .9680 (back under the bullish support line and overnight lows) and a target at .9875 (ahead of the 150-pip projection of the breakout).

The USD/CAD continued to move higher within its bullish channel over the past 24 hours. The pair rallied strongly in today’s early European session, putting in a bit of a Bullish Marubozu Candle on the 4hr chart, but rates are nearing a couple of key resistance levels. The unit is currently testing previous highs at 1.0310 and even a break above this level may be quickly capped by the 2013 high at 1.0335. At this point, discretion is warranted until we see a confirmed break above 1.0335 or a drop through rising trend line support. Stay tuned to FX360 and our daily Live Market Analysis webinars for any updates or new trade ideas later today.

The AUD/USD dropped off yesterday after a brief retest of resistance at .9837. Thankfully, the quick bounce gave us an opportunity to enter a quick sell trade that has already moved well in our favor (see “AUD/USD Sell: If at First You Don’t Succeed…” for more). The stop has already been moved to breakeven (.9815), though more conservative traders may want to consider closing the trade out early ahead of Bernanke’s speech at 10:00EDT/14:00GMT. For now, we will leave the trade unadjusted and continue to watch for a dip to the profit target at .9730 next.

The NZD/USD also bounced modestly during yesterday’s North American trade before turning sharply lower in today’s Asian and early European sessions. At this point, the bias remains to the downside and further drops are likely with room down toward the .8100 round handle or support near the Monthly S3 Pivot at .8071. Stay tuned to FX360 and our daily Live Market Analysis webinars for any updates or new trade ideas later today.