At the start of the week, from Monday onwards, a significant move has been observed in the US dollar against major global currencies. The US Dollar witnessed a broad-based sell-off yesterday, and notably, this move was not driven by US bond yields nor by weakness in US asset markets.
As a result, major currencies strengthened sharply. and have surged close to their 52-week high, trading around the $1.2026 level and $1.3831 level during the European morning session. At these elevated levels, I believe the market is now well positioned for profit booking from today onwards.
If the US Dollar regains strength, we could see sharp corrective moves in major currencies such as EUR/USD and GBP/USD, along with pressure on precious metals like Gold and Silver both.
Based on this view, I expect profit booking in EUR/USD and GBP/USD, and also sharing my intraday trading strategy below:
Intraday Strategy – EUR/USD
- Sell EUR/USD at CMP $1.2026 – $1.2036
- Stop Loss: $1.2101
- Downside Targets: $1.1940 – $1.1920 – $1.1900
Intraday Strategy – GBP/USD
- Sell GBP/USD at CMP $1.3830 – $1.3840
- Stop Loss: $1.3900
- Downside Targets: $1.3750 – $1.3710 – $1.3650
If profit booking emerges, EUR/USD and GBP/USD may decline sharply within the next few hours. Traders are advised to book profits above Target 1 as momentum builds. My strategy for today is to sell aggressively at higher levels, while maintaining disciplined risk management.
