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EUR/CHF is still trading above psychological level at 1.1000 and the pair is headong towards 1.1200. Selling pressures will likely grow around those levels. Hourly support is located at a distance at 1.0984 (13/07/2017 low). Expected to inch higher.

In the longer term, the technical structure is mixed. Resistance can be found at 1.1200 (04/02/2015 high). Yet,the ECB's QE programme is likely to cause persistent selling pressures on the euro, which should weigh on EUR/CHF. Supports can be found at 1.0184 (28/01/2015 low) and 1.0082 (27/01/2015 low).

EUR/GBP is very volatile. The pair is consolidating lower. Hourly support is given at a distance at 0.8742 (16/06/2017 low). Downside risks are important.

In the long-term, the pair has largely recovered from recent lows in 2015. The technical structure suggests a growing upside momentum. The pair is trading above from its 200 DMA. Strong resistance can be found at 0.9500 psychological level.

AUD/USD's technical structure has finnaly not reversed. Hourly resistance given at 0.7989 (19/07/2017 high) has been broken. Hourly support given at 0.7875 (21/07/2017 low). There is no sign that the momentum will reverse.

In the long-term, we are waiting for further signs that the current downtrend is ending. Key supports stand at 0.6009 (31/10/2008 low) . A break of the key resistance at 0.8295 (15/01/2015 high) is needed to invalidate our long-term bearish view.

USD/CAD is going lower and the pair remains in a strong bearish momentum. Hourly resistance is given at 1.2544 (26/07/2017). Expected to show continued bearish pressures.

In the longer term, the pair is now monitoring long-term support that can be found at 1.2461 (16/03/2015 low). Strong resistance is given at 1.4690 (22/01/2016 high). The pair should head lower.

USD/CHF is trading lower. Hourly support can be found at 0.9439 (21/07/2017 high). Strong resistance is given at 0.9771 (15/06/2017 high). Expected to to show further bearish consolidation

In the long-term, the pair is still trading in range since 2011 despite some turmoil when the SNB unpegged the CHF. Key support can be found 0.8986 (30/01/2015 low). The technical structure favours nonetheless a long term bullish bias since the unpeg in January 2015

USD/JPY has failed to go any higher. Hourly support is given at 110.62 (24/06/2016 low). Stronger support is located at a distance at 108.83 (17/04/2017 low). Expected to show continued bearish pressures in case support at 110.62 breaks.

We favor a long-term bearish bias. Support is now given at 96.57 (10/08/2013 low). A gradual rise towards the major resistance at 135.15 (01/02/2002 high) seems absolutely unlikely. Expected to decline further support at 93.79 (13/06/2013 low).

GBP/USD has broken hourly resistance is given at 1.3126 (16/07/2017 high). Hourly support is given at 1.2933 (20/07/2017 low). Expected to show continued bullish pressures.

The long-term technical pattern is even more negative since the Brexit vote has paved the way for further decline. Long-term support given at 1.0520 (01/03/85) represents a decent target. Long-term resistance is given at 1.5018 (24/06/2015) and would indicate a long-term reversal in the negative trend. Yet, it is very unlikely at the moment.

EUR/USD bullish pressures continue. Hourly resistance given at 1.1712 (25/07/2017 high) has been broken. Hourly support can be found at 1.1371 (13/07/2017 high). Stronger support lies at 1.1292 (28/06/2017 low). Expected to show continued bullish pressures.

In the longer term, the momentum is now turning largely positive. We favour a continued bullish bias. Key resistance is now holding at 1.1871 (24/08/2015 high)t while strong support lies at 1.0341 (03/01/2017 low).

Dollar under pressure as US yields slide amid dovish FOMC statement

As broadly expected, FOMC members decided to leave monetary policy unchanged, maintaining the target range for the federal funds rate to 1% to 1.25% and not providing a clear timing about its balance sheet reduction plan. Little changes were made to the statement compared to the June version. The Federal Reserve acknowledged that inflation measures have declined and are now running below the 2% target. Most importantly, changes were made to the expected start of the balance sheet normalization program. In June statement, the Fed expected the program to be launched this year and it expects to be implemented 'relatively soon'. Does the market has to worry about such a change?

From our standpoint, we think this is definitely a dovish adjustment to the statement as it removes clarity regarding the timing, giving more room to start the balance sheet run off. In reaction to this dovish modification, the US dollar was heavily sold off yesterday amid the release. The dollar index fell another 1.10% to 93.15, the lowest level since mid-June last year. Higher yielding currencies were the big winners with the New Zealand and Australian dollar rising 1.60% and 1.15% respectively.

A fresh batch of US data is due for release later today. Initial jobless claims should come in at 1960k versus 1977k a week ago. More importantly, after shrinking two months in a row, durable goods orders should have risen 3.7%m/m in June. Excluding transportation, the indicators should rise by 0.4%m/m compared to 0.3% in July.

After months of lacklustre data, investors have a real need to see some solid and uninterrupted flow of encouraging data from the US. This only under these conditions that we’ll see a bounce back of the US dollar and the pursuit of recovery in US yields.

VIX at an all-time low

The news did not make massive headlines. The VIX, the US volatility index which is also known as the 'Fear Index', just collapsed to an all-time low below 10. We recall that the 20-year average is above 20 for the index. A few weeks ago, Janet Yellen, Fed Chairman, warned markets about asset valuation which she considers as too high. Fed definitely believes that stocks markets are in a bubble. This is ironic as the Fed largely participated to underpin asset prices with free money.

While the volatility is at an all-time low, stocks prices are at an all-time high. There is then the potential relation between low volatility and high stock prices which could drive investors towards a sell-off. Markets are now in a pausing mode certainly fearing that consequence. However, stocks markets are not losing steam and may further head higher.

All eyes are on Fed now which balance sheet reduction should be discussed in November. Currency-wise the dollar is now trading at 14-month low on recent disappointment of Trump expected fiscal policies and Fed failing to fully deliver what was expected.

The pair bounced above 111.00 handle after dipping to 110.77 low in Asia but struggles to firmly break above daily cloud top (111.23).

Near-term focus remains shifted lower after previous rally’s rejection at strong 112.10 barrier and subsequent weakness on profit-taking, accelerated by Fed.

While daily cloud caps upside attempts, risk of further weakness and retest of key supports at 110.62 (24 July low / daily cloud base) will remain in play, with break here to trigger fresh extension of larger downleg from 114.49.

Initial requirement for bearish resumption is close below 110.97 (Fibo 61.8% of 108.80/114.49 rally) after several probes below support proved to be false breaks.

Conversely, lift above daily cloud needs to regain minimum 111.74 (falling daily Tenkan-sen) to sideline immediate downside risk and open way towards key resistance at 112.10 barrier (Fibo 38.2% of 114.49/110.62 downleg / 200SMA).

Res: 111.33, 111.74, 111.95, 112.10
Sup: 110.77, 110.62, 110.23, 110.00