Foreign Exchange Market Commentary

EUR/USD closed lower on Friday as it consolidated some of this week's rally and closed below initial resistance marked by the 10-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI remain bullish signalling that additional short covering gains into early November are possible. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. If it renews this month's decline, weekly support crossing is the next downside target.

USD/JPY closed higher on Friday due to short covering as it consolidated some of this week's decline, which spiked below the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI remain bearish signalling that a short-term top is in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If it renews this fall's rally, weekly resistance crossing is the next upside target.

GBP/USD closed lower on Friday as it consolidated some of this week's rally and closed below resistance marked by the 10-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are bullish signaling that additional short covering gains are possible near-term. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. If it renews this month's decline, the 87% retracement level of the 2001-2007-rally crossing is the next downside target.

USD/CHF closed higher on Friday due to short covering as it consolidated some of this week's decline, which spiked below the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI remain bearish signalling that a short-term top is in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If it renews this fall's rally, weekly resistance crossing is the next upside target.

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