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EURUSD remains under pressure and the risk is still to the downside as prices continue to drift lower from the 20-day simple moving average (SMA) and the latest high of 1.0280. The short-term technical indicators are still holding in bearish territory. The RSI is pointing downwards below the neutral threshold of 50, while the MACD is rising above its trigger line in the negative region.

The next target to the downside is the parity level again, which the price failed to have a daily close beneath it. However, the price may meet the spike of July 14 that reached a new 20-year low at 0.9950. Further losses could open the way for a test of the return line of the downward sloping channel around 0.9800 ahead of the 0.9610 barrier, taken from the low in September 2002.

Upside moves are likely to find resistance at 1.0280. Rising above this area would help shift the focus to the upside towards 1.0345 before meeting the descending trend line, which is standing near the 40-day SMA at 1.0400. Breaking this level could see a re-visit of the 1.0635 high and turn the bias to bullish.

In the medium-term, the bearish phase remains in play especially if prices continue to trade within the channel and below the SMAs.

EUR/USD

After reaching a parity, the single european currency managed to recover some of the lost positions against the U.S. dollar, but during the past week, neither the bulls, nor the bears were able to dominate the market and we witnessed a formation of a range movement in the narrow channel between 1.0120 - 1.0270. There is plenty of economic news this week that could be a factor in setting a clearer direction for the currency pair. Among the most anticipated news will be the release of the U.S. consumer confidence data (Tuesday; 14:00 GMT), the U.S. Fed interest rate decision (Wednesday; 18:00 GMT), U.S. gross domestic product data (Thursday ; 12:30 GMT), as well as the announcement of the Eurozone inflation rate (Friday; 09:00 GMT) and also Eurozone GDP data, again on Friday, at 09:00 GMT.

USD/JPY

The USD/JPY correction deepened at the end of the last week, with the bears managing to lead the market towards the support area at 136.00. At the time of writing, the currency pair is on the verge of a test of the mentioned level and a successful breach could give the bears the necessary incentive to attack the next levels around 135.00, followed by the one at 134.00. The main economic news that could affect the volatility of the currency pair and the sentiment of investors is mentioned in the analysis of EUR/USD, with the most significant being the announcement of the U.S. Fed interest rate decision, which in turn could lead to a renewed appreciation for the dollar.

GBP/USD

The pound, like the euro, has been in a range since the beginning of last week, with neither the bulls, nor the bears managing to prevail. The trade is limited between the levels 1.1890 - 1.2031. The plethora of economic news coming this week could paint a clearer picture of the future of the currency pair. The main resistance for the bulls is the level at 1.2030 and the main support is the level at 1.1760.

EUGERMANY40

The appreciation of the German index during the past week was limited to the resistance level at 13426. The subsequent depreciation could be softened as a corrective phase, as the bears repeatedly failed to prevail and breach the main support at 13095. The current week is abundant with important economic news that could lead to increased volatility for the index, as well as the delineation of a clearer direction. A deepening of the sell-off on the possible breach of the lower limit of the outlined range between 13095 - 13426 will lead to a test of the next significant area before the bears at 12939.

US30

The U.S. blue-chip stock index failed to break through the resistance at 32045 at the end of last week. The subsequent decline cannot be considered complete until the bears test the support level at 31643. On the other hand, a successful breach at this level might as well deepen the sell-off towards the next significant area around 31076. Investors are eagerly awaiting the economic news mentioned in the EUR/USD analysis, which will be a major factor in the movement of the index this week. Increased volatility is expected, especially around the announcement of the U.S. Fed interest rate decision (Wednesday; 18:00 GMT).

The FTSE 100 outperforms global peers supported by commodity and financial stocks. A tentative break above the supply zone around 7350 has put the index back on track. A bullish MA cross on the daily chart suggests that sentiment may have improved. The latest retracement found support on the 38.2% (7220) Fibonacci level. A close above 7350 would flush out the remaining selling interest and trigger an extended rally towards 7450. The 50% retracement level at 7180 is buyers’ second line of defense.

The euro softened after manufacturing and service activities in the eurozone contracted in July. The pair has met stiff selling pressure at July’s high at 142.30. A break below 140.70 caused a liquidation of leveraged long positions and a bearish MA cross indicates an acceleration to the downside. The former support has turned into resistance. 138.50 at the origin of a bullish breakout is the next support. 137.00 is a critical level from the daily chart and its breach could pave the way for a bearish reversal in the medium-term.

The Canadian dollar retreats dragged by weakness in oil prices, the country’s main export. The pair has been hovering above the daily support at 1.2820. The RSI’s double dip in the oversold area led some traders to buy the dip. A rally above 1.2930 would squeeze the short side. The bulls will need to clear 1.3020 before they could regain control and push back above 1.3130. Failing that, the path of least resistance would be down. A fall below 1.2820 would invalidate the July rally and cause a sell-off towards 1.2700.

Daily Pivots: (S1) 1.0146; (P) 1.0201; (R1) 1.0271; More...

Range trading continues in EUR/USD and intraday bias remains neutral. Further rise is in favor this week as long as 1.0118 minor support holds. Above 1.0277 minor resistance will target 1.0348 support turned resistance. Sustained break there will bring stronger rebound back to channel resistance (now at 1.0493). On the downside, below 1.0118 will bring retest of 0.9951 low instead.

In the bigger picture, down trend from 1.6039 (2008 high) is still in progress. Next target is 100% projection of 1.3993 to 1.0339 from 1.2348 at 0.8694. In any case, outlook will stay bearish as long as 1.0773 resistance holds, in case of strong rebound.

Daily Pivots: (S1) 1.1929; (P) 1.1996; (R1) 1.2076; More...

Intraday bias in GBP/USD remains neutral for the moment. On the upside, firm break of 1.2055 minor resistance will confirm short term bottoming at 1.1759. Bias will be turned back to the upside for 1.2405 resistance next. On the downside, break of 1.1759 will resume larger down trend.

In the bigger picture, fall from 1.4248 (2018 high) could be a leg inside the pattern from 1.1409 (2020 low), or resuming the longer term down trend. Deeper decline is expected as long as 1.2666 resistance holds. Next target is 1.1409 low. However, firm break of 1.2666 will bring stronger rise back to 55 week EMA (now at 1.2986).

Daily Pivots: (S1) 0.9575; (P) 0.9640; (R1) 0.9679; More...

Intraday bias in USD/CHF remains on the downside. Fall from 0.9884 is seen as a falling leg of the consolidation from 1.0063. Deeper decline would be seen to 0.9493 support. On the upside, though, above 0.9738 minor resistance will turn bias back to the upside for 0.9884 resistance.

In the bigger picture, medium term up trend from 0.8756 (2021 low) is still in progress. On resumption, next target is 1.0342 (2016 high). Sustained break there will resume long term up trend from 0.7065 (2011 low). This will remain the favored case as long as 0.9471 resistance turned support holds.

Daily Pivots: (S1) 135.11; (P) 136.54; (R1) 137.50; More...

Intraday bias in USD/JPY remains neutral for the moment. On the downside, firm break of 134.73 will confirm short term topping, on bearish divergence condition in 4 hour and daily MACD. Deeper fall would be seen through 55 day EMA to 126.35/131.34 support zone. On the upside, break of 139.37 will resume larger up trend.

In the bigger picture, current rally is seen as part of the long term up trend from 75.56 (2011 low). Next target is 100% projection of 75.56 (2011 low) to 125.85 (2015 high) from 98.97 at 149.26, which is close to 147.68 (1998 high). This will remain the favored case as long as 126.35 support holds.

Daily Pivots: (S1) 0.6886; (P) 0.6932; (R1) 0.6970; More...

Intraday bias in AUD/USD is neutral with current retreat. Further rise is mildly in favor as long as 0.6858 minor support holds. Sustained trading above 55 day EMA (now at 0.6967) will pave the way to 0.7282 resistance next. Nevertheless, break of 0.6858 will turn bias back to the downside for retesting 0.6680 low.

In the bigger picture, price actions from 0.8006 (2021 high) could still be a corrective pattern to rise from 0.5506 (2020 low). But current downside acceleration, as seen in weekly MACD), is raising the chance that it's a bearish impulsive move. In either case, outlook will remain bearish as long as 0.7282 resistance holds. Next target is 61.8% retracement of 0.5506 to 0.8006 at 0.6461.