The euro and the pound continued to rise yesterday, and did so at a reasonably solid pace. The absence of important data allows risk assets to continue showing this kind of movement.

Rumors of Jerome Powell's resignation only strengthened demand for risk assets, thereby weakening the U.S. dollar's position.

Clearly, traders—tired of the uncertainty in U.S. monetary policy—are responding enthusiastically to any hints of potential leadership changes at the Federal Reserve. However, it is worth noting that the situation remains fragile. The lack of a trade agreement between the EU and the U.S. will continue to limit the pair's upward potential, and only hints from the European Central Bank about ending its rate-cutting cycle would allow the medium-term bull market to continue.

Today, the only data expected from the Eurozone concerns the Consumer Confidence Indicator.

It is unlikely that this indicator will significantly shift the market balance, so buying is expected to remain dominant. Only unexpected statements from representatives of the U.S. Fed or the ECB could provoke sharp fluctuations in the currency markets. Likewise, comments from EU and U.S. trade negotiators may positively impact demand and continue the bullish market for the euro.

If the data aligns with economists' expectations, it's best to follow a Mean Reversion strategy. If the data is significantly better or worse than expected, the Momentum strategy is recommended.

Momentum Strategy (Breakout):

EUR/USD

Buying on a breakout above 1.1745 may lead to a rise in the euro toward 1.1775 and 1.1790

Selling on a breakout below 1.1720 may lead to a decline in the euro toward 1.1680 and 1.1660

GBP/USD

Buying on a breakout above 1.3545 may lead to a rise in the pound toward 1.3583 and 1.3615

Selling on a breakout below 1.3505 may lead to a decline in the pound toward 1.3470 and 1.3436

USD/JPY

Buying on a breakout above 147.20 may lead to a rise in the dollar toward 147.45 and 147.74

Selling on a breakout below 146.95 may lead to dollar sell-offs toward 146.50 and 146.20

Mean Reversion Strategy (Pullbacks):

EUR/USD

I will look for selling opportunities after a failed breakout above 1.1750 followed by a return below this level

I will look for buying opportunities after a failed breakdown below 1.1725 followed by a return above this level

GBP/USD

I will look for selling opportunities after a failed breakout above 1.3536 followed by a return below this level

I will look for buying opportunities after a failed breakdown below 1.3510 followed by a return above this level

AUD/USD

I will look for selling opportunities after a failed breakout above 0.6578 followed by a return below this level

I will look for buying opportunities after a failed breakdown below 0.6553 followed by a return above this level

USD/CAD

I will look for selling opportunities after a failed breakout above 1.3618 followed by a return below this level

I will look for buying opportunities after a failed breakdown below 1.3585 followed by a return above this level