5 May, 2016
Economic data from the US yesterday was broadly positive helping to strengthen the US dollar, but the markets pulled back towards the end of the day. Ahead of tomorrow's nonfarm payrolls report, markets could remain sideways. GBPUSD could potentially see some strong moves as the currency trades within a key resistance and support levels, with the downside likely to move for a test to 1.430 support.
EURUSD Daily Analysis
EURUSD (1.14): EURUSD closed in a small bodied candlestick pattern yesterday which could indicate a temporary pause to the decline while at the same time opening the risk for another move to the upside. Prices are seen to be well supported by 1.1470 support, and unless the support breaks, there is a potential for EURUSD to test the upside in the near term. On the 4-hour chart, EURUSD is forming a steep bullish flag pattern that could signal further upside. But the previous highs at 1.15925 must be cleared for further upside in prices.
USDJPY Daily Analysis
USDJPY (107.1): USDJPY continues to push higher on the daily chart with the Stochastics nearly signaling a bullish reversal. Resistance is seen near 108 - 107.85, which needs to be cleared on a daily session to signal further upside to the next main resistance at 110.672. On the 4-hour chart, we notice a hidden divergence, with the Stochastics printing a higher high against price's lower high indicating a near-term downside. Support is seen near 106.60 which needs to hold failing which, USDJPY could resume its declines to test the previous lows.
GBPUSD Daily Analysis
GBPUSD (1.45): GBPUSD continued to drift lower but so far has not tested the support at 1.44250. The 4-hour chart shows a possible retest to the upside near 1.4635 - 1.45845 to test the breakout level. Establishing resistance here could signal the downside to 1.4425 followed by 1.4312 - 1.430. The bearish bias is invalidated if GBPUSD closes above the identified resistance level, in which case, price action could continue pushing higher towards 1.4740.
Gold Daily Analysis
XAUUSD (1281.5): Gold prices posted a two-day low yesterday, but the declines were quickly rejected with prices closing back higher. Support at 1275.99 was clearly strong enough to push gold back above this level. Resistance at 1291 - 1289 remains likely to be tested, and a break above this resistance could open further upside in gold. A break below 1275 could, however, see gold prices dip to the next support at 1262 - 1258 levels.
The common currency which had fallen sharply over the past few weeks and was eventually seen hovering above the support level of 1.1540 level was seen...
The U.S. dollar fell sharply across the board yesterday after the U.S. President Trump in an interview...
The U.S. dollar lost ground yesterday amid a slow trading day with lack of any clear catalysts for the markets. The speech by Janet Yellen did not offer anything new for the markets...
Mexico's inflation is likely to be boosted higher as the government announced that it would be hiking fuel prices by nearly one-fifth from January. The government said that fuel price ceilings will be capped between 14.2% - 20% above December's prices...
The Institute of Supply Management's Purchase Managers Index data is one of the most widely watched indicators. It is considered to be a leading indicator which gauges the strength in the U.S. manufacturing sector...
A fairly quiet Monday saw USDJPY retreating from its recent highs ahead of the big events this week. USDJPY has retraced its gains and now trades just above the support level of 104. The markets look to another slow day today with no major events on the tap, leaving the bulk of trading on the technical aspects...
A quiet economic calendar today ahead of the FOMC and BoJ meetings this week could keep prices fairly flat. The US dollar looks well supported moving into the FOMC meeting first which could keep the euro subdued...
The Bank of England's decision to hold monetary policy steady saw the GBP surge against the US dollar, clearing 1.32 with 1.36 now coming into focus...
Political developments in Japan and the UK saw the respective currencies react in the positive. While the GBP managed to close bullish on news that Theresa May is likely to be the new PM...