Daily Technical Analysis

EUR/USD

Current level – 1.1800

The currently developing pullback of the EUR/USD belongs to the larger time frames. The support that is supposed to withhold the sell-off is found at around 1.1700. From the current price levels stem a few possible scenarios. Bears could directly charge at the level of 1.1780, with 1.1700 being their main target, or they can wait for better entries above the consolidation zone at around 1.1860. Swift market recovery towards 1.2000 is not impossible, but is less likely to happen at the moment. Another consolidation between 1.17870 and 1.1880 might be coming up as well since traders’ focus is shifted towards the ECB’s meeting later this week. Today, the EU GDP data is expected at 09:00 GMT, while the ECB interest rate decision, accompanied by forward guidance by the central banker, is scheduled for Thursday at 11:45 GMT. The decision and the commentary made during the press conference have the potential to trigger huge and unexpected moves.

USD/JPY

Current level – 106.27

The weak Japan GDP data from earlier this morning supported the Greenback and the pair is consolidating. Expectations are adopting a bullish bias after the double bottom at the 105.30 support and the failure of the bears at around 106.400. First support for the pair is found at 106.02. If a bullish breach of the consolidation is to occur, the first target for the bulls would be 106.94, followed by the level of 107.20. Market sentiment could shift if the market falls below the 106.10-106.00 levels.

GBP/USD

Current level – 1.3144

The Cable’s sell-off is still ongoing and, at the time of writing, prices are testing the breach of the consolidation that took place for the most part of August. Buyers should expect more substantial support at around 1.3050 and, if the level does not hold, the pullback could deepen towards 1.2800. The resistance around 1.3460 comes from the larger time frames, so the currently observed retracement is perfectly normal. Market sentiment is still bullish, however the pullback phase could take some time due to the pound’s excellent performance since March. First intraday support for the pair lies at around 1.3120, while first major resistance zones are found at 1.3180 and 1.3250.