USD/JPY is pushing higher above 112.00. Strong support is located at 111.12 (20/09/2017 low). Expected to show further bullish pressures. Yet, downside risks are now rising as markets may soon take some short-term profit.
GBP/USD is pushing higher after recent surge. Hourly resistance is given at 1.3657 (20/09/2017 high). Strong support is given at 1.2774 (24/08/2017 low). Expected to show continued bullish consolidation.
EUR/USD lies in a bullish trend despite ongoing consolidation. Hourly resistance can be found at 1.2092 (08/09/2017 high) while hourly support lies at 1.1823 (31/08/2017 low). Stronger support is given at a distance at 1.1662 (17/08/2017 low). Expected to show renewed bullish pressures.
The Aussie is firmly in red in early Thursday's trading and accelerated stronger down after speech of RBA's governor Lowe, who said that the central bank has considerable independence and does not need to follow global trend, when most of major central banks were stuck in hawkish tone recently.
The pair continues to trend higher after hawkish Fed boosted dollar on Wednesday and Bank of Japan, as expected, kept policy steady at the end of two-day meeting, keeping the overall bullish trajectory in play. Fresh extension approaches next targets at 112.80 (Fibo 76.4% of 114.49/107.31 descend) and psychological 113.00 barrier (also Fibo 50% of larger 118.66/107.31 descend). Bulls may take a breather at these points as strongly overbought slow stochastic on daily chart warns of pullback. Broken 200SMA (112.18) should ideally contain dips and guard daily cloud top (111.61) violation of which would sideline bulls and signal deeper correction.
Cable is holding within narrow consolidation in early Thursday's trading, following 200 pips- wide range on Wednesday, when the pair was boosted by better than expected UK retail sales data and then hit strongly on hawkish tone from Fed.
The Euro is consolidating above fresh post-Fed lows at 1.1865 zone in early Thursday, with scope seen for further downside. The single currency was sharply lower on hawkish tone after FOMC September’s meeting. Fed signaled one more rate hike this year and plans three hikes in 2018, as well as start of reducing its portfolio in October.
In accordance with expectations, a release of much better than expected data on the UK Retail Sales led to a premature breakout from a symmetrical triangle. However, the subsequent Federal Funds Rate announcement dragged the pair in the opposite direction. For the third day in raw the fall of the rate was stopped at the monthly R2, which is located at the 1.3485 level. Today the currency pair is not expected to make any significant moves, as it is squeezed between two combined barriers that are likely to neutralize any attempts of a breakout. From the top it is constrained by the 55- and 100-hour SMA, while from the bottom by the above monthly R2 plus the weekly PP at 1.3456. But from a daily perspective, the buck is expected to continue to gradually recover against the Pound.
A decision of the Fed to start reducing the size of its $4.5 trillion asset portfolio caused a very high volatility in the markets, which resulted in 123 points appreciation of the Dollar against the Euro just in one hour. From technical perspective, this event signified a breakout of the pair from a rising wedge. Although the fall was sharp, it was stopped by a combined support formed by the monthly PP at 1.1881 together with the bottom trend-line of a dominant ascending channel. On the one hand, today the buck might make another attempt to break to the bottom, using the downside momentum from the yesterday’s event. On the other hand, on a daily chart it looks like the rate formed a third reaction low yesterday and, for this reason, has to make a fully-fledged rebound.
The Sterling strengthened significantly against the US Dollar, as all the main components of the UK retail sales report showed better-than-expected figures for August. After the release, the GBP/USD jumped by 0.67% or 91 base point to touch the daily high of 1.3606 However, by the next couple of hours the pair resumed trading in a weaker area between the 1.3525 and 1.3560 marks.
The EURUSD pair has come under heavy selling pressure, as the U.S dollar index surged higher, following yesterday FOMC meeting. Following the monetary policy statement release, the 1-hour price-candle immediately spiked to 1.2031, then fell to 1.1861.
The USDJPY pair has moved to its highest trading level since July 17th, hitting 112.64, after the Federal Reserve announced that they will start to taper their balance sheet in October and look to raise U.S interest rates one more time in 2017.
USDJPY remains neutral in the medium term and has been trading in a broad range between 108 and 114 over the past 6 months. The near-term bullish phase that started last week from near solid support in the 108-area is still in place.
AUD/USD drop fast and could hit new lows in the upcoming hours. It could drop below the 0.7939 previous low and could hit the lower median line (LML) of the major ascending pitchfork. Technically is expected to drop after another spike. Is traded outside the minor ascending pitchfork’s body, a valid breakdown below the LML will open the door for a major drop.
Price dropped significantly after the FOMC and looks poised to start a corrective phase on the short term. EUR/USD is narrowing on the short term, but it could breakout from this range and could make a significant move. Technically, it could drop much deeper on the short term after the retest of some important resistance levels.
GBPUSD (1.3491):The British pound closed with a doji yesterday as price continued to consolidate above the 1.3500 handle. The bullish flag pattern remains in play as GBPUSD is seen currently testing the support level at 1.3483. As long as this support holds, the bias is to the upside although resistance at 1.3590 will need to be breachedin order to set the stage for further gains. In the near term, GBPUSD could be seen consolidating within the resistance and support levels. A breakout from could either validate or invalidate the bullish flag pattern.
EURUSD (1.1885): The EURUSD fell sharply yesterday to close at a 4-day low. Price action is expected to continue the momentum, but the declines could be stalled near 1.1820. On the 4-hour chart, the head and shoulders pattern failed with price reversing strongly. EURUSD is seen currently supported at 1.1882 along with the rising trend line. This could offer some near-term support, but unless the bullish momentum sends the common currency to post fresh highs, we can expect this sideways pattern to continue.
DXY Short Term Elliott Wave view suggests that the decline to 91.01 ended Primary wave ((3)). Primary wave ((4)) bounce remains in progress as a double three Elliott Wave structure. Up from 91.01, Intermediate wave (W) ended at 92.66 and Intermediate wave (X) ended at 91.591. Near term, while pullbacks stay above 91.591, expect Index to extend higher towards 93.227 – 93.618 area to complete Primary wave ((4)). Afterwards, Index should resume the decline lower or at least pullback in 3 waves. We don’t like buying the proposed bounce.
The currency pair rallied in the last hours and reached some important resistance levels. Is trading in the green even if the Federal Reserve has decided to keep the Federal Funds Rate steady at 1.25%. The greenback rallied versus all its rivals after the FOMC, the USDX jumped aggressively and now is pressuring the 92.49 static resistance again.
The Federal Reserve did not disappoint those who were waiting for hawkish stance and firmer signals about central bank's next steps in coming few months. As conclusion of FOMC's September meeting, US policymakers announced they left interest rates unchanged at 1.25%, as widely expected outcome, but signalled one more rate hike towards the end of the year and three more hikes in 2018.
The currency pair has resumed the minor rebound and has touched a near-term dynamic resistance. Technically is expected to drop on the short term, but unfortunately, the fundamental factors will take the lead later. Price has changed little till now, but a high volatility is expected during the FOMC, you should stay away from trading tonight because you can ruin your account.
USD/CAD decreased significantly after the false breakout above the confluence area formed by the median line (ml) with the lower median line (LML). Price failed to stay above the median line (ml) of the minor ascending pitchfork and now approaches the lower median line (lml). A breakdown from the minor pitchfork will signal a further drop.
With the pair may be biased to upside in the medium term but faces a pullback risk on price hesitation. However, it will have to break and hold above its key resistance located at the 1.2091 level to prevent a return to the downside. Resistance comes in at 1.2050 level with a cut through here opening the door for more upside towards the 1.2100 level.
As inflation recently in the US has had a recent slight increase near 1.9% p.a., it is still below their target range. Despite this, Actual QoQ GDP Growth has increased to 3%, well ahead of forecast and consensus, and this has seen Forward Company Earnings improve in the US also.The Fed will be conscious of all of this, however, as they saw a small increase in Unemployment and Inflation still below their target levels, they are inclined to keep the rates flat for this month.
The USDJPY pair is starting to correct lower as the U.S dollar index weakens, with price-action drifting towards the 111.20 region, ahead of today's U.S Federal Reserve interest rate decision and monetary policy statement.
The British pound spiked to 1.3607 against the U.S dollar following much better than expected monthly and annual UK retail sales figures, further increasing the chances of the BOE hiking rates in October. Price-action has however pulled back dramatically from 1.3600 level after the sharp uptick on the news, with the pair retracing down to 1.3517, finding support from the pairs key 50-hour moving average.
Despite the excellent data for CAD currency, the USD economy also showed good numbers on Friday. While unemployment is still at 4.7% and wages are going up, we might assume that the economy is very strong and that may lead to another rate hike. I personally believe the US Fed will continue to gradually raise rates in the US leading to gradual USD strength in the medium term.
USD/CAD is edging higher. Hourly support is located at 1.2062 (08/09/2017 low). Resistance is now given at a distance at 1.2239 (intraday high). Expected to show continued short-term bearish pressures.
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