Sat, Jun 10, 2023 @ 04:51 GMT
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Daily Technical Analysis


Since Friday, the euro managed to find a bottom at around 1.0364, and on the first trading day of this week, it managed to continue its rally against the dollar. The marked weakness of the U.S. currency across the currency board was evident and allowed the bulls to gain ground. However, with the opening of the U.S. stock exchange at 13:30 GMT, the pair corrected around the resistance at 1.0440. Another upward momentum followed suit, which again hit the mentioned resistance and ended the session below the aforementioned level.Today’s macroeconomic calendar is expected to show data on the retail sales in the U.S. (12:30 GMT). If said data does not disappoint the traders and pushes them to buy the dollar, then the EUR/USD may have another decline on its hands, which could take it below the support of 1.0364. In the opposite scenario, in which the market’s reaction to the presented data is negative, the dollar might start to lose ground against the common European currency and the level at 1.0482 may be reached again.


The strength of the dollar against the yen from last week has weakened, and in the early hours of today’s session, we saw an 80-pip drop towards the key level of 128.70, where the USD/JPY found support. The following correction towards the resistance at 129.50 gave the bears some good entry points and they increased their short volumes. As a direct result, the Ninja lost even more ground. Whether the dollar will show strength and once more search for levels at around 130.50 depends on the market sentiment after the data on the U.S. retail sales is released at 12:30 GMT. A scenario, in which traders are disappointed following the release, should not be ruled out and declines towards the level of 127.48 can be expected.


In the first trading session of the week, the bulls seem to be in full control of the sterling. The day started calmly – with a slight decline towards the support at 1.2215, but during the working hours of the European and the U.S. stock exchanges, the GBP/USD started an aggressive rally. The key level at around 1.2270 was breached after BOE governor Andrew Bailey’s statement that inflation is expected to rise towards a new peak of 10% by the end of the year. Activity today is expected to pick up after 6:00 GMT, when data on the UK labour force will be released. Unemployment is expected to remain unchanged at 3.8%, while wages are not likely to rise on a quarterly basis. Whether the pound will rise towards 1.2400 will largely depend on the reaction of the traders. The possibility of a recovery of the downward trend should not be neglected either, after which the Cable might target the levels at 1.2170.


The German index suffered slight losses in its first session, despite last week’s breakthrough at the key level of 13885. In the early hours of today’s trading, the EUGERMANY40 was locked in a range between 13885 and 14066, but with breaches on both ends of the channel. Shortly before the opening of the Wall Street index, it once again reached the above mentioned levels, but quickly gained momentum and corrected its declines with nearly 300 points. Despite that, it ended the session at about 13986. Lack of data shows that the EUGERMANY40 is likely to follow the movements of the U.S. indices. If they continue to rise amidst a weak dollar, then we can expect a breach of 14066 and a rise towards the next resistance at around 14310. However, the monthly trend should not be totally ignored, so if 13885 is attacked again, it is unlikely to last and it’s possible that the fall could deepen to levels below 13690.


The blue-chip index gained momentum with the opening of the U.S. stock exchange at 13:30 GMT despite the choppy trading before that, when the index found support at the key level of 31937. The bulls were in control and the adjustments were minimal, with the US30 trading at 32530 a few hours before the closing bell. The peaks failed to hold until the end of the trading session and the corrections pushed the price down towards 32192. Whether traders will take advantage of the weak dollar and enter the market more aggressively will depend on the U.S. retail sales data, scheduled for today at 12:30 GMT. However, if we see a negative market reaction, then the US30 may try to breach its support from yesterday and once more search for a new bottom at around 31225. Another spike in volatility can be expected at 18:00 GMT, when the governor of the Federal Reserve Jerome Powell will hold a speech.

DeltaStock Inc.
DeltaStock Inc.
These analyses are for information purposes only. They DO NOT post a BUY or SELL recommendation for any of the financial instruments herein analyzed. The information is obtained from generally accessible data sources. The forecasts made are based on technical analysis. However, Delta Stock’s Analyst Dept. also takes into consideration a number of fundamental and macroeconomic factors, which we believe impact the price moves of the observed instruments. Delta Stock Inc. assumes no responsibility for errors, inaccuracies or omissions in these materials, nor shall it be liable for damages arising out of any person's reliance upon the information on this page. Delta Stock Inc. shall not be liable for any special, indirect, incidental, or consequential damages, including without limitation, losses or unrealized gains that may result. Any information is subject to change without notice.

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