31 October, 2016
The US dollar index was seen attempting to pare losses from Friday's news reports on the FBI - Clinton email scandal which sent the dollar broadly lower. However, despite the current uptick, the gains in the US dollar could be limited with the weekly session closing in a dark cloud cover candlestick pattern indicating a near term decline to the downside. Technical support is seen near 96.18 - 95.85 which could infer that the dollar could be seen weakening over a busy week which includes the FOMC statement, ISM manufacturing and Friday's payrolls report.
EURUSD Daily Analysis
EURUSD (1.0968): With the EURUSD closing above 1.0900 last week, price action is now a few pips away from challenging 1.1000 resistance. A premature pullback before testing this resistance could see the euro's declines limited towards 1.0920 - 1.0950. The price action on the 4-hout chart time frame also shows a potential cup and handle pattern that could be formed with the resistance seen at 1.0975 with the Fibonacci retracement zone of 1.0931 - 1.0903 marking the 38.2 - 61.8 retracement level. A reversal off this retracement zone followed by a breakout above 1.0975 - 1.1000 could signal further upside in the euro towards 1.1050 followed by 1.1095. A break down below 1.0900 could, however, invalidate this bullish bias, keeping EURUSD under pressure to the downside.
EURAUD Daily Analysis
EURAUD (1.4406): EURAUD has been bullish for the past two days following the pin bar reversal near the support at 1.4200. The current pullback could be seen limited to 1.4309 - 1.4344 support level. As noted last week, EURAUD is looking to target 1.4560 to challenge the broken support level for resistance. A higher low near the support level of 1.4309 - 1.4344 could signal further upside in EURAUD. The weekly time frame in EURAUD closed with an outside bar indicating that a breakout above the high of 1.4484 could signal further upside in prices.
USDJPY Daily Analysis
USDJPY (104.74): USDJPY has been bullish over the past weeks, but the consolidation into the triangle pattern is indicative of a near-term pullback in prices. Resistance is seen at 105.00 - 105.16 price level, and if USDJPY fails to breakout above this resistance, a near-term decline could see prices fall towards 104.00 which is the initial support followed by 103.00 - 103.25. Alternately, a bullish continuation to the upside above 105.16 could signal further gains in USDJPY which could then challenge the next main resistance at 106.00 which was tested briefly in July this year.
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