FX.co ★ Forecast for EUR/USD and GBP/USD on June 13. Inflation report did not interfere with traders

EUR/USD – 4H.

As seen on the 4-hour chart, the EUR/USD pair performed a new reversal in favor of the US dollar and consolidation under the correction level of 61.8% (1.1318). Yesterday, the euro had every reason to continue its growth. The consumer price index in America was 1.8% y/y, below traders' expectations. Since inflation is a very strong report, traders could react with new purchases of the pair. However, it was the opposite. And it was yesterday's fall of the euro that makes you wonder if the desire of traders to buy the euro has dried up. In recent weeks, the EU currency has strengthened against the backdrop of weak economic surveys from America. The euro does not have its own fundamental support. But it has a considerable number of problems of both political and economic nature, which clearly contradict the growth of the European currency. This may include unresolved Brexit, budget problems with Italy, the possible aggravation of trade relations with the United States, and a possible reduction in the key rate of the European Central Bank. Thus, it is possible that traders simply run out of fuse and they are not ready to continue to make purchases above the level of 1.1345. The rebound of the pair from the Fibo level of 50.0% will allow traders to expect a reversal in favor of the euro and a return to the correction level of 61.8%.

The Fibo grid is built on extremums from March 20, 2019, and May 23, 2019.

Forecast for EUR/USD and trading recommendations:

The EUR/USD pair came close to the correction level of 50.0%. Thus, I recommend buying the euro today with a target of 1.1318, a protective order under the Fibo level of 50.0%, if there is a rebound from the correction level of 1.1277. I recommend selling the EUR/USD pair after closing the quotes below the level of 50.0% with the goal of a correction level of 1.1237 and a stop-loss order above 1.1277.

GBP/USD – 4H.

The GBP/USD pair also performed a reversal in favor of the US dollar on June 12 and began the process of returning to the correction level of 76.4% (1.2661). Accordingly, the dollar rose yesterday and paired with the British pound. Thus, the growth of the US currency was widespread, and the reasons should be sought either in America or in the mood of traders. Since only one report on inflation was released in the US yesterday, and it cannot be called positive, then, most likely, traders are again beginning to look closely at buying the US currency. Paired with the pound sterling, this is especially logical, as the UK is now in a state where it is very difficult for the market to find the motivation to buy its currency. We are not waiting for news from America today. There are new speeches by Donald Trump, which cannot be foreseen in advance. If the growth of the US currency continues today, it will be a very strong reason for the assumption of a change in the mood of traders in the bearish. The rebound of the pair on June 13 from the Fibo level of 76.4% will allow expecting a reversal in favor of the English currency and a resumption of growth in the direction of the correction level of 61.8% (1.2796). The closing of the pound/dollar pair under the Fibo level of 76.4% will increase the chances of a further fall in the direction of the next correction level of 100.0% (1.2437).

The Fibo grid is built on the extremes of January 3, 2019, and March 13, 2019.

GBP/USD – 1H.

As seen on the hourly chart, the pair pound/dollar is approaching the resistance level of 161.8% (1.2673) again, from which three rebounds have already been made. A new rebound from this level of Fibo will work again in favor of the pound and the beginning of growth in the direction of the correctional level of 127.2% (1.2781). Closing of the pair's quotes below the level of 161.8% will allow traders to count on the continuation of the fall in the direction of the correction level of 200.0% (1.2554). Today, the divergence is not observed in any indicator.

The Fibo grid is built on the extremes of April 25, 2019, and May 3, 2019.

Forecast for GBP/USD and trading recommendations:

The GBP/USD pair returned to two important levels of correction on two charts. I recommend buying the pair with the target of 1.2781, with the stop-loss order below the level of 1.2673, if there is a new rebound from the level of 161.8%. I recommend selling the pair at the close of quotations under the level of Fibo 76.4% (4-hour chart) with a target of 1.2554 and a protective order above the level of 1.2673.