Sample Category Title

New trading week the currency rate stared in a limbo between the 200-hour SMA from the bottom and a combination of the weekly PP, the 55- and 100-hour SMAs from the top. Such neutral movement reflects anticipation of the Bank of Japan Policy Rate announcement. But since there is high probability that the central bank will left the monetary policy unchanged, the pair is not expected to act unpredictably. Such assumption is partially supported by presence of two extremums, which have already forced the rate to make a rebound more than once. The first is located near the 114.30 mark, while the other at the 113.34 level. A breakout through one of these barriers is likely to follow after the FOMC Statement, which will be delivered on Wednesday.

Friday's trading session was significant for two reasons. On the one hand, the cable managed to break through the lower trend-line of the senior ascending channel. On the other hand, it failed to slip below the 1.3090 mark, which correlates with location of the bottom boundary of an alleged larger, dominant ascending channel.

Such outcome allows assuming that this pattern will be strong enough to block another attempt of the pair to fall below the 1.3100 mark, following the general strengthening of the Dollar. At the same time, rapid recovery of the Pounds seems unlikely as well due to presence of a combined resistance set up by the weekly PP, the 55-, 100- and 200-hour SMAs.

In result of the previous trading session, the currency exchange rate slipped through the updated 23.6% Fibonacci retracement level at 1.1679 and, in essence, made a rebound from the bottom trend-line of a dominant descending channel. Due to absence of any fundamental data releases, bulls are likely to try to return the rate back to 1.1643, at minimum. However, the further recovery of the Euro seems unlikely because of a combined resistance formed by the monthly S1 at 1.1658, the weekly PP at 1.1674 and the falling 55-hour SMA. The southern side, in contrast, remains barrier-free. In addition to that, there is couple of fundamental factors that incite further appreciation of the Dollar, such as Donald Trump’s tax reform and possible nomination of John Taylor, as the Fed chair.

Gold is in a steady downtrend. Better than expected advance GDP in US continues to weight on Gold. My conclusion is that the USD gains and risk appetite continue to limit the upside for Gold. However we might see a retracement from L3 towards POC1 and POC2. The POC1 (D cm, W H1, EMA89, 61.8, trend line, atr pivot) 1273.20-1275.35 could turn the price down to 1268.18 and 1262.69. A deeper retracement might also target POC2 1278.50 zone-1280.00 (D H3, WH3, atr pivot) and the rejection should target same levels as I mentioned above. 1h momentum or 4h candle close below 1262.69 might target 1254.73

W H3 - Weekly Camarilla Pivot (Weekly Interim Resistance)

W H4 - Weekly Camarilla Pivot (Strong Weekly Resistance)

D H4 - Daily Camarilla Pivot (Very Strong Daily Resistance)

D L3 – Daily Camarilla Pivot (Daily Support)

D L4 – Daily H4 Camarilla (Very Strong Daily Support)

POC - Point Of Confluence (The zone where we expect price to react aka entry zone)

EUR/USD

Current level - 1.1612

Current rebound after 1.1572 low should be considered corrective, preceding another leg downwards, to 1.1480 zone. Initial resistance lies at 1.1660, followed by the crucial break-out zone at 1.1720.

USD/JPY

Current level - 113.67

The intraday outlook is counter-trend, for a reversal and renewal of the general rise towards 115.50 zone. Key support lies at 113.05.

GBP/USD

Current level - 1.3135

The recent low at 1.3067 signals a completion of the slide from 1.3280, but the rebound is by all means corrective, so 1.3180 is expected to cap the upside, for another leg downwards, to 1.3020, en route to 1.2910 area.

EURUSD has come under increased pressure after dipping another leg lower to break below the head and shoulders neckline at 1.1660. The drop below what was considered to be a key support level with strong downside momentum indicates that the market has moved into a bearish phase and further weakness is expected.

Prices have currently stabilized around 1.1615 and the 1.1470 level is expected to provide solid support. From here, the focus would shift to key levels at 1.1300 and 1.1100 ahead of the 1.0820 low.

Immediate resistance is now provided by previous support at 1.1660. Rising above this important level would target the area around 1.1845, which is where the 50-day moving average has provided a barrier during the past month. Thus, rising above this resistance would indicate the short-term bearish phase has ended and EURUSD would be on the path to re-test the 1.2091 multi-year high that was hit on September 8. Clearing this point would confirm the resumption of the uptrend that started from 1.0820.

In the near-term, EURUSD is vulnerable, with risk clearly tilted to the downside as RSI is bearish below 50. The technical break of the head and shoulders neckline (1.1660) suggests downside risks remain.

The US dollar faced some profit-taking against other majors, after receiving a boost the previous week on tax reform hopes in the US and strong third quarter growth while the euro was hit by the political uncertainty in Spain.

Euro/dollar climbed above the 1.16 level to trade around 1.1615, as markets will be focusing on Catalonia and how the region is going to function during the week after the central government in Madrid has taken over control of the region and sacked the regional government. The tense situation seems to be weighing on the euro, which was further hit the previous week after Draghi pledged that the ECB's asset purchase program is likely to be extended further than the 9 months of 2018 and that rates would also not rise next year.

The dollar also failed to hold the 114 mark against the Japanese yen as it dipped to as low as 113.50 before recovering to 113.72. 10-year Treasury yields were lower at 2.40% (compared to a high of 2.48% on Friday), which took away some support from the greenback.

In the session's notable movers, the New Zealand dollar fell once more after its attempt to recover from Friday's lows. The kiwi traded at 0.6845 against the greenback, significantly down on the session but off Friday's low of 0.6817. The kiwi has been plagued by worries that the country's new incoming coalition government could undertake economic reforms that might lead to lower interest rates and less foreign investment.

In today's economic news, German retail sales for September missed expectations by coming in at 0.5% month-on-month against analyst forecasts of 0.7%. This had an initial negative effect on the euro, but the currency quickly recovered from those losses in an indication perhaps that some traders were willing to buy the euro at its current levels.

A little later in the European session, October business climate and consumer confidence surveys out of the European Commission will come out and in the United States, personal income and spending together with the Fed's favorite inflation indicator will also be published. In Europe the clocks turned back to winter time over the weekend, which means that the time difference with the US is smaller by one hour during this week, until the US also switches to winter time next weekend.

XAUUSD (1271.66): Gold prices continued to push lower last week as price briefly fell close to the 1266 handle in the short term. The current consolidation seen at 1272 level will be crucial for price action in the short term. A convincing close above this level will suggest further upside towards 1285.00. A potential breakout above this level though will shift to the bullish bias in gold prices. The next main resistance level is seen at 1324 - 1320 level.

USDJPY (113.57): USDJPY managed to rally back to the resistance level on Friday but closed on a bearish note. Price action remains consolidating within the rising wedge pattern on the daily chart. This suggests a potential breakdown to the downside. Initial support is found at 110.70 followed by a test towards 108.26 eventually. On the 4-hour chart, initial support is seen near the price level of 113.00 that could offer some short-term support. However, following this bounce, we expect further declines to be extended towards 110.70.

EURUSD (1.1613): The EURUSD breached the support level at 1.1710 - 1.1672 on Friday. The breakdown of this support level suggests further downside in price with a test towards the 1.1440 support level. On the 4-hour chart, the validation of the descending triangle pattern could see price attempting to retrace the losses back to the breached support level. If price action moves back to 1.1710 - 1.1672, then we can expect the resistance level to be established here. A reversal at this level is likely to keep prices poised to the downside. In the event of a move above 1.1710 - 1.1672, then EURUSD could be seen trading within the new range above this support level.