Although the US economy showed convincing signs of growth, the Pound continued to rapidly appreciate against the Dollar yesterday. The fact that the cable managed to return to mid-October level near 1.3295 indicates how actively traders are anticipating interest rate hike by the Bank of England, which even overshadows today’s FOMC meeting. From technical point of view, there is a need to notice that both on hourly and daily timeframes the pair is free to surge up until the weekly R2 located at the 1.3370 level (after passing through the above resistance). Until release of the American data, the pair is expected to move horizontally near 1.3270. Afterwards, in case of plunge it is likely to be stopped by the 200-hour SMA fluctuating near 1.3180.
Despite a release of various macroeconomic data yesterday, including the Euro Zone CPI and CB Consumer Confidence, the pair did not make any sharp moves and continued to move horizontally between the 100- and 55-hour SMAs. Such indifference nicely illustrates how traders are anticipating the upcoming FOMC Monetary Policy Statement and appointment of the new Fed Chair by President Trump. Given that yesterday’s information appeared to be better than expected plus general consensus that today’s meeting will not bring any unexpected news suggests that the pair is likely to continue moving horizontally between the 1.1658 and 1.1625 levels with a tendency to stick to the southern direction. A major breakout to the top also looks unlikely because that side contains multiple barriers.
AUDUSD is under pressure below its 200-day moving average. The market has been reversing the May to September uptrend, retracing over half of this move. The drop below the 50% Fibonacci level of the 0.7328 to 0.8124 upleg last week has strengthened the short-term bearish bias.
USDJPY (113.86): The USDJPY recovered the losses from Monday as price action turned bullish on yesterday's close. Still, the consolidation above 113.00 which marks a short term support level could see the currency pair trading sideways. The bounce off this support level will see USDJPY likely to test the previous resistance level near 114.00. The short-term range looks to be formed for the moment, and a breakout from either of these levels is required to post further gains or losses.
EURUSD (1.1630): The EURUSD established a short range yesterday as price action closed with a doji type pattern on the daily session. A bearish decline today could signal a continuation to the downside. This could be expected amid a host of economic releases from the U.S. On the 4-hour chart, price action has formed a potential bearish flag pattern. This could be validated on a close below 1.1573 and will see the euro extending the declines towards 1.1411. However, failure to close below 1.1573 could keep the bias neutral with the potential for price action to retrace the gains back to 1.1688.
The U.S dollar has rebounded sharply higher against the Japanese Yen, hitting 113.93 during the Asian trading session. The USDJPY pair currently trades close to highs of the day, as rising Japanese stocks and better than expected company earnings boost risk-on sentiment in financial markets. Traders now await the release of the U.S ADP jobs report and the ISM manufacturing PMI for the month of October.
The British pound has risen sharply higher against the U.S dollar, hitting 1.3293, during today's Asian trading session. The GBPUSD pair is currently consolidating around the 1.3270 level, as broad-based strength in the British pound is being underpinned by a probable rate hike from the Bank of England tomorrow. GBPUSD traders now await the upcoming release of the United Kingdom's Manufacturing PMI, for the month of October.
The New Zealand Dollar started a crucial downtrend from the 0.7200 swing high against the US Dollar. The NZD/USD pair is currently well below 0.6920 and looks set to extend declines. During the recent slide, the pair broke the 0.7060 and 0.6900 support levels and traded as low as 0.6818. The pair is currently attempting a recovery, but facing sellers near the 38.2% Fib retracement level of the last decline from the 0.7003 high to 0.6818 low.
The British pound continues to move higher against the U.S dollar during the European trading session, after breaking above the key 1.3201 level. Intraday U.S dollar weakness and the expected rate hike from the Bank of England on Thursday are supporting British pound buying interests. The GBPUSD pair currently trades around the price-highs of the day, ahead of the release of Consumer Confidence in the upcoming U.S trading session.
The EURUSD pair continues to struggle to gain traction above the key 1.1644 resistance level, as weaker than expected eurozone inflation data and political woes in Spain, weigh on euro intraday trading sentiment. Multiple technical price failures around the 1.1644 level during the European session, have pressured the EURUSD pair back towards the 1.1630 region. Traders now look to the release of key United States Consumer Confidence data, which due out in the upcoming U.S session.
AUD/USD continues to bounce back but downside pressures are still lively. Hourly resistance is given at 0.7897 (13/10/2017 high). Further. Expected to show continued decline towards key support at 0.7571 (05/07/2017 low).
USD/CAD is holding above former resistance at 1.2778 (15/08/2017 high). This suggests an extension of bullish momentum. Hourly support lies at 1.2331 (26/09/2017 high). Expected to show continued short-term bullish pressures.
USD/CHF is clearly in a strong bullish momentum. The technical structure suggests an improving short-term buying interest. Expected to show continued bullish pressures within uptrend channel. Hourly support stands at 0.9712
USD/JPY is riding lower within short-term uptrend channel. Key resistance stands at 114.49 (11/07/2017 high). Support is located at 111.12 (20/09/2017 low). We favor a long-term bearish bias. Support is now given at 99.02 (10/08/2013 low). A gradual rise towards the major resistance at 125.86 (05/06/2015 high) seems unlikely. Expected to decline further support at 93.79 (13/06/2013 low).
EUR/USD is consolidating higher after setting a new hourly resistance at 1.1575 (27/10/2017 low). Hourly resistance is located at 1.1658 (30/10/2017 high). Expected to show some shortterm consolidation.
In line with expectations, the Euro continued to successfully recover against the Dollar until it met the first line of defence set up by the monthly S1 at 1.1658. Nevertheless, a pressure from the 55-hour SMA is likely to provoke the pair to make another attempt to break to the top. On the one hand, a combined resistance formed by the weekly PP at 1.1674 and the 100-day SMA represent too strong barrier to be so easily crossed. On the other hand, the exchange rate two days ago made a rebound from the bottom edge of a senior descending channel. From this perspective, the pair is expected to climb upstairs for some while. An additional impulse might be provided after today's release of the Euro Zone's inflation data.
The first arrests made in result of Robert Mueller’s investigation as well as anticipation of the upcoming interest rate hike helped the pair to prematurely break through a massive resistance set up by three moving averages plus the weekly PP at 1.3160. In general, bulls are expected to try to push the cable to the last Thursday’s pre-fall level at 1.3270. However, today this attempt is likely to be blocked by another resistance level formed by the weekly R1 at 1.3250 and the upper trend-line of an alleged two-month long descending channel. On the other hand, there is a need take into account effect from release of various American fundamental data later this day, which might either provide an additional impulse for a breakout to the top or drag the pair back to the 100-hour SMA.
On Tuesday, the Bank of Japan left the interest rate, target inflation and core inflation forecast unchanged. In other words, they still amount to -0.1%, 2% and 1.8%. However, since this decision was widely expected, the Yen did not gain much value against Dollar. In fact, it stuck at the weekly S1 at 113.13. However, this correction is likely to last only until release of the American data. Depending on the actual figures the pair might either surge to the combined resistance set up by the 200-, 100- and 55-hour SMAs near 113.60 or slip further to the weekly S2 located at the 112.58 level. From daily perspective, the pair is expected to start gradually moving in the southern direction, as previous two days marked a long awaited breakout from the rising wedge formation.
USDJPY (113.16): The USDJPY is showing sign of weakness as price action is currently seen hovering near the lower trend line of the rising wedge pattern. This pattern formed on the daily chart signals a possible downside price action. Support is seen at 110.70 which could be the likely target. On the 4-hour chart, USDJPY touched down to the support level at 113.00 briefly. We expect to see a modest rebound off this level as USDJPY remains flat within 114.00 and 113.00 price levels. A breakout to the downside below 113.00 will signal a move to the next support at 112.00 ahead of further declines that can be expected towards 110.70.
EURUSD (1.1636): EURUSD managed to close on a bullish note yesterday following two consecutive days of declines. Price action was however muted as the euro approaches the previously breached support level. If resistance is formed here, the EURUSD could be seen reversing the modest gains. Further downside could be expected as the currency pair is likely to follow through to the downside. The initial target level of 1.1552 is likely to be tested followed by further declines towards 1.5500 level of support. This will mark the minimum price objective to the downside, following the descending triangle pattern that was formed.
The U.S dollar continues to move lower against the Japanese Yen, as the U.S dollar index remains under selling pressure, following the Russian collusion story surrounding the Trump administration. The USDJPY pair currently trades around the 113.20 level, after the Bank of Japan announced no change in monetary policy in today's policy meeting. Investors now await the release of Consumer Confidence data from the U.S economy.
The euro continues to remain under selling pressure against the U.S dollar, despite rallying to 1.1658 during late Monday trading. The EURUSD pair currently trades around the 1.1630 level, as traders await a raft of high-impact economic data coming out from the eurozone today. During the European trading session, we see the release of key Eurozone Inflation, Gross Domestic Product and Unemployment figures for the month of October.
NZDUSD has declined considerably in recent weeks, falling to a five-and-a-half-month low of 0.6817 during Friday's trading. The Tenkan-sen line being below the Kijun-sen line is a negative alignment pointing to bearish momentum in the short-term. Adding to this, both lines maintain a fairly steep negative slope.
GBPUSD: The pair was seen triggering a recovery during early trading today following its price rejection on Friday. This leaves the pair targeting more strength in the days ahead possibly towards the 1.3278 zone. On the downside, support lies at the 1.3100 level where a break will turn attention to the 1.3050 level. Further down, support lies at the 1.3000 level. Below here will set the stage for more weakness towards the 1.2950 level.
The British pound has moved sharply higher against the U.S dollar during the European trading session, hitting 1.3188, as investors start to price-in a rate hike from the Bank of England this week. The GBPUSD pair currently trades around the price-highs of the day, as the BOE prepare to hike UK interest rates for the first time in over a decade. During the upcoming U.S trading session, we see the release of the Federal Reserve's preferred measure of monthly U.S inflation data, CORE PCE.
The U.S dollar continues to trade on the backfoot against the Japanese Yen, with price-action so far finding interim daily support around the 113.50 level. Intraday weakness in the U.S dollar index, due to U.S political uncertainty, is currently supportive of selling in the USDJPY pair. Investors await the upcoming release of CORE PCE data from the United States, and the Bank of Japan's monetary policy decision in the early hours of Tuesday morning.
AUD/USD is bouncing back but downside pressures are still lively. Hourly resistance is given at 0.7897 (13/10/2017 high). Further. Expected to show continued decline towards key support at 0.7571 (05/07/2017 low).
USD/CAD has broken resistance at 1.2778 (15/08/2017 high). This suggests an extension of bullish momentum. Hourly support lies at 1.2331 (26/09/2017 high). Expected to show continued short-term bullish pressures.
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