Dollar pares gains on weak ISM report

2 September, 2016

The US dollar closed bearish yesterday after the ISM manufacturing report showed an unexpected downside surprise. Following up from the doji pattern that formed on Wednesday, yesterday's bearish close could see a near-term pullback in the US dollar which we have been waiting for all week. Today's NFP report comes with significant risks which could sway short-term market sentiment.

EURUSD Daily Analysis

EURUSD (1.1200): EURUSD closed bullish yesterday with prices seen testing 1.1200 resistance level. The hidden bullish divergence on the daily chart could indicate a near-term continuation subject to price clearing the 1.1200 resistance level. On the 1-hour chart, as noted yesterday, prices pulled back lower to form a higher low before posting strong gains to reach 1.1200. The 1-hour chart now shows a potential cup and handle pattern that could be formed if prices remain consolidated at the current levels unless price breaks out strongly higher. In any case, watch for a pullback towards 1.1175 - 1.1150, ahead of further gains to the resistance level of 1.1270 - 1.1281.

USDJPY Daily Analysis

USDJPY (103.29): USDJPY barely managed to test 104.00 resistance before pulling back lower to the close the day at 103.23. Support is now seen near 102.00, which could form a higher low. Although USDJPY looks poised to the downside in the near term, the long term bias remains to the upside with a potential test towards 108.00. Also, note the potential head and shoulders continuation pattern that is forming. A break down below 100.00 could signal further downside in USDJPY on the daily chart.

GBPUSD Daily Analysis

GBPUSD (1.3282): GBPUSD managed to break out above 1.3200 yesterday after the manufacturing PMI surprised to the upside. Further gains could be seen pushing GBPUSD towards 1.3400. However, watch for a pullback towards 1.3200 - 1.3170, or a breakout above 1.33 currently which could keep the bullish momentum going.

Gold Daily Analysis

XAUUSD (1314.01): Gold prices were seen trading near the 1315 - 1300 support zone that was identified. But the breakout from the rising median line signals further downside. Watch for a rally back to the 1331.30 - 1327.50 resistance level which could be tested in the near term. This is also validated by the bullish divergence seen on the 4-hour time frame.


Source link  
Dollar looking to recover from the weekly declines

Lack of any clear catalyst kept the markets drifting. The scheduled health-care vote which was due...

Investors turn to Yellen speech

The British pound settled after briefly slipping from the highs of 1.250 to post session lows at 1.2423 earlier...

U.S. dollar slips as investors scale back

The U.S. dollar index fell below the 100.00 handle yesterday as investors scaled back the Trump Trade...


USD continued to weaken yesterday

Price consolidated yesterday as directional catalysts have subsided in the wake of the ECB/ FOMC meetings. Local resistance at the January high of 1.0828 is the first challenge. Above their puts the focus on the bigger technical level of 1.0975 which is the 50%...

Short covering rally continues

Short covering rally continues. Local resistance at the January high of 1.0828 is the first challenge. Above their puts the focus on the bigger technical level of 1.0975 which is the 50% Fibonacci retracement from last year’s high. We also have the completion...

Dutch exit polls bodes well for EURUSD

The initial exit polls from various sources have clearly put the Dutch incumbent Prime Minster Mark Rutte's party in the lead against his radical opponent, Geert Wilders...


Fed and Dutch set the tone for a busy day

The FOMC's interest rate decision today will be closely watched as traders brace for a third rate hike in just under two years, since December 2015. The short term Fed funds rates are expected to rise to 0.75%...

U.S. dollar wavers, PPI data coming up

Trading was flat with the currencies seen giving back the gains made from Friday. The lack of any major events also contributed in part to the flat trading. Traders will be looking forward to the first part of a busy week starting tomorrow with the Fed's rate hike looming...

Draghi's speech stands out amid a quiet trading session

The single currency is seen extending the gains from Friday's rally even as the ECB president Mario Draghi is slated to speak later today...

  


Share: