USD/CAD retreats to 1.3050 area amid decisive oil recovery
Our preference: short positions below 1.3070 with targets at 1.3030 & 1.3015 in extension.Alternative scenario: above 1.3070 look for further upside with 1.3095 & 1.3110 as targets.
Barrel of WTI gains more than 1.5% on Monday.
US Dollar Index stays in green above the 97 handle.
Coming up: Federal Reserve Bank of Chicago’s National Activity Index.
The USD/CAD pair spent the first half of the day moving sideways in the tight 1.3060-70
range but came under modest selling pressure in the last hours as the rising crude oil prices helped the commodity-related
loonie gather strength against its major rivals.
As of writing, the pair was trading at 1.3050, losing 0.07% on a daily basis.
After Iran seized another British oil tanker last Friday, the heightened geopolitical tension in the Middle East revived
concerns over supply disruptions and provided a boost to crude oil prices. As of writing, the barrel of West Texas
Intermediate was trading at $56.75, up 1.85% on a daily basis.
USD/CAD Analysis: Decline likely to continue
Our preference: short positions below 1.3045 with targets at 1.3010 & 1.2990 in extension.Alternative scenario: above 1.3045 look for further upside with 1.3055 & 1.3070 as targets.
The US Dollar depreciated about 48 base points against the Canadian Dollar on Friday.The currency pair was pressured south by the 50-hour simple moving average during the previous trading session.
Everything being equal, it is likely that the USD/CAD exchange rate will continue its southern movement within this session.
The potential target will be near the weekly S1 at 1.2983.
NZD/USD technical analysis: Move beyond 100-DMA/0.6700 handle to open room for strong follow-through
Our preference: the upside prevails as long as 0.6673 is support.
Alternative scenario: the downside breakout of 0.6673 would call for 0.6652 and 0.6639.
The NZD/USD pair maintained its bid tone for the fourth consecutive session on Wednesday and is hovering around
the 0.6685-90 strong horizontal resistance.
This is closely followed by the 0.6700 confluence region – comprising of 100-day SMA and 50% Fibonacci retracement level of
the 0.6939-0.6482 recent bearish slide.
Technical indicators on the daily chart are holding comfortably in the bullish territory and are still far from pointing to overbought conditions,
supporting prospects for an
eventual bullish breakout and an extension of the positive momentum.
A convincing break through the mentioned barrier now seems to set the stage for a follow-through up-move towards the 0.6800 round figure mark,
which coincides with 61.8% Fibo. level and might now be the next major hurdle for bullish traders.
GBP/USD remains depressed below 1.2700 mark ahead of US data
Our preference: short positions below 1.2800 with targets at 1.2530 & 1.2435 in extension.
Alternative scenario: above 1.2800 look for further upside with 1.3000 & 1.3175 as targets.
No-deal Brexit fears continue to keep a lid on any attempted bounce.
The USD builds on the overnight bounce and adds to the selling bias.
Investors now look forward to the US economic data for fresh impetus.
The GBP/USD pair failed to capitalize on its intraday up-move beyond the 1.2700 handle and quickly retreated around 25-pips in the last hour.
Having dropped to weekly lows, around the 1.2660 region, the pair gained some traction during the early European
session but lacked any strong conviction amid increasing fears of a no-deal Brexit.
The favourite UK PM candidate Boris Johnson’s commitment to leave the EU by October 31st,
even without a deal held the GBP bulls on the sidelines and continued capping the attempted up-moves.
Investors were further discouraged by the BoE Governor Mark Carney’s comments that uncertainty is hurting economic
performance and that the central bank may cut rates in case of a no-deal Brexit.
On the other hand, the US Dollar remained supported by the overnight not so dovish comments by St Louis Fed President
James Bullard and the Fed Chair Jerome Powell, which added to the selling bias.
Meanwhile, the downside remained limited, at least for the time being, as investors now look forward to Wednesday’s key highlight –
the release of US durable goods orders data, for some fresh impetus.
EUR/USD Technical Analysis: Bearish view unchanged while below the resistance line at 1.1406
Our preference: short positions below 1.1400 with targets at 1.1375 & 1.1355 in extension.Alternative scenario: above 1.1400 look for further upside with 1.1420 & 1.1440 as targets
EUR/USD remains sidelined in the 1.1300 neighbourhood following last week’s drop to the 1.1280/70 band.
The pair came under downside pressure after last week’s up move failed to convince market participants above the key barrier at
1.1400 the figure, coincident with the 5-month resistance line.
Furthermore, the negative stance on the pair is expected to prevail as long as this resistance line caps the upside, today at 1.1406.
EUR/CHF Approaching HFT Buy Area!
Our preference: the downside prevails as long as 1.1163 is resistance.
Alternative scenario: above 1.1163, look for 1.1182 and 1.1193.
We are analyzing the activity of HFT algorithms in the Forex market today and noticed that the EURCHF
currency pair is moving toward the light HFT buying pressure zone that is noted at 1.1174 and below.
The prior lows in the 1.1175 area were formed yesterday when the bearish attempt was rejected.
EURCHF is retesting this area today again, though so far no bullish signal is formed here.
The Improved CCI indicator is showing the trend to be bearish, but the overbought/oversold indicator is showing the
EURCHF 1-hour timeframe is entering the oversold territory.
A bullish pattern or signal now would provide confirmation that the support and the light HFT buying pressure
zone here will attract enough buyers to lift the pair higher.
In such a case, the light HFT selling pressure zone, noted at 1.1215 and above, will be an interesting target.
:NZD/USD consolidates Tuesday’s gains, trades above 0.65 ahead of key events
Our preference: the downside prevails as long as 0.6542 is resistance.
Alternative scenario: above 0.6542, look for 0.6562 and 0.6575.
The FOMC is expected to keep its policy rate unchanged on Wednesday.
US Dollar Index posts small daily losses, sits above 97.50.
Statistics New Zealand will release the first quarter GDP data.
After adding 40 pips and closing the day at 0.6535, the NZD/USD has gone into a consolidation phase
as investors moving to the sidelines ahead of key events of the day. As of writing, the pair was posting small daily losses at 0.6525.
The greenback, which took advantage of the selling pressure surrounding the euro,
gathered strength against its rivals on Tuesday and the US Dollar Index advanced to its highest level in two weeks at 97.77.
The dollar’s next move is very likely to be triggered by the FOMC statement and Chairman Powell’s remarks later today. At the moment,
the DXY is down 0.06% on a daily basis at 97.58.
EUR/AUD Likely to slide down
Our preference: the upside prevails as long as 1.6282 is support.
Alternative scenario: the downside breakout of 1.6282 would call for 1.6227 and 1.6194.
The common European currency has appreciated about 1.81% in value against the Australian Dollar since the beginning of June.
This bullish run has helped the currency pair reached a six-month high at 1.6362.
Everything being equal, it is likely that the EUR/AUD exchange rate could edge lower within this week’s trading sessions.
The possible target for bearish traders will be near the weekly S1 at 1.6199
EUR/USD Current Dynamics and Recommendations
Our preference: as long as 1.6303 is support look for 1.6453.
Alternative scenario: below 1.6303, expect 1.6248 and 1.6215
EUR / USD failed to develop an upward correction above the resistance level of 1.1310 (ЕМА144 on the daily chart).
On Wednesday, EUR / USD resumed its decline after the publication at the beginning of the American session of positive
macro statistics from the United States, indicating a modest, but still rising inflation in the United States.
As the US Department of Labor reported on Wednesday,
consumer prices in May increased compared to April, but less significantly than expected (in annual terms,
+1.8% against the forecast of +1.9% and +2.0% in April). The base consumer price index,
which does not take into account food and energy, rose by 2% compared with May 2018, compared with the expected growth of 2.1%.
NZD/USD Analysis: Breaches junior channel
Our preference: rebound towards 0.6615.
Alternative scenario: below 0.6559, expect 0.6538 and 0.6526.
The New Zealand Dollar has continued to edge lower in a narrow descending channel pattern against the US Dollar.
The currency pair breached the upper boundary of the channel pattern at 0.6576 during the morning hours of Wednesday’s trading session.
Given that a breakout had occurred, it is likely that the NZD/USD
exchange rate will aim for a resistance level formed by the 100-hour simple moving average at 0.6616 during the following trading session.