In anticipation of tomorrow's ECB statement, the euro bears are taking the common currency to the bottom part of its recent range. Will the move stick? Otherwise, we're not seeing more pronounced moves across the currencies today. But how do these gyrations fit the bigger picture? There's actually one move that is making us adjust our open position...

In our opinion, the following forex trading positions are justified - summary:

• EUR/USD: long (a stop-loss order at 1.0963; the initial upside target at 1.1112)
• GBP/USD: long (a stop-loss order at 1.2139; the initial downside target at 1.2467)
• USD/JPY: none
• USD/CAD: none
• USD/CHF: short (a stop-loss order at 0.9996; the initial downside target at 0.9768)
• AUD/USD: long (a stop-loss order at 0.6751; the initial upside target at 0.6916)

The short-term situation remains unchanged as EUR/USD keeps trading inside the blue consolidation. While the pair headed lower to trade at around 1.1020 as we speak, this move is yet unconfirmed and the day is far from being over.

Trading position (short-term; our opinion): long positions with a stop-loss order at 1.0963 and the initial upside target at 1.1112are justified from the risk/reward perspective.

GBP/USD

The very short-term situation in GBP/USD also hasn't changed much as the exchange rate remains stuck inside the blue consolidation. Earlier today, the bulls took the pair to the 50% Fibonacci retracement.

As there are no sell signals at the moment, we still could see a test of the pink resistance zone created by the 61.8% Fibonacci retracement and the 38.2% retracement based on the entire May-September downward move.

Trading position (short-term; our opinion): long positions with a stop-loss order at 1.2139 and the initial downside target at 1.2467 are justified from the risk/reward perspective.

USD/CHF

USD/CHF extended gains earlier today and climbed above the orange resistance zone. Although this is a positive development for the bulls, the exchange rate is still trading below the pink resistance zone and the upper border of the green rising trend channel.

Nevertheless, taking into account the current position of the indicators, it seems that a test of these resistances before the reversal can't be ruled out. Therefore, we decided to move the stop-loss order a bit higher.

What could happen if the bulls show weakness in the above mentioned area? In our opinion, USD/CHF will likely decline not only to the previously-broken red declining resistance line, but also to the lower border of the rising green trend channel.

Trading position (short-term; our opinion): Short positions with a fresh stop-loss order at 0.9996 and the initial downside target at 0.9768 are justified from the risk/reward perspective.

Summing up the Alert, the euro headed lower prior to tomorrow's ECB, but the British pound trades close to unchanged today. Both long positions remain justified. USD/CHF keeps going higher, and the position of the daily indicators makes us adjust the stop-loss order. The short position also remains justified as a downward reversal remains probable. AUD/USD is trading marginally higher today, and the daily indicators still favor continuation of the move up. The profitable long position remains justified from the risk-reward point of view. Apart from these, there're no other opportunities worth acting upon in the currencies. As always, we'll keep you - our subscribers - informed.

Thank you.

Nadia Simmons
Forex & Oil Trading Strategist