by JustForex
The head of the Philadelphia Fed Patrick Harker has become another official who wants the central bank to start cutting stimulus measures as soon as this year. On the one hand, such verbal interventions lead to an increase in the dollar index at the moment. However, traders should not forget that the European Central Bank is also preparing to cut stimulus, which will have a fundamental effect on the euro strength.
From the technical point of view, the general trend on the EUR/USD currency pair is bullish. Yesterday, the buyers took the initiative from the support level 1.1783. The MACD indicator is in the negative zone, but there are signs of sellers’ weakness and an increase in buyers’ strength. Under such market conditions, buy trades can be considered from the support levels where buyers show initiative. It is better to look for sell trades from the resistance levels above the moving average and only with short targets.
Alternative scenario: if the price breaks through the 1.1704 support level and fixes below, the mid-term uptrend will likely be broken.
The UK government is considering the possibility of postponing checks on food imports amid fears of increased pressure on supermarket supplies in the run-up to Christmas. Business executives have said that import cancellation rules will not solve the problem because food shortages are related to a lack of truck drivers.
On the hourly time frame, the GBP/USD trend is bullish. But against the background of the dollar index growth, the growth of GBP/USD quotes is limited. The MACD indicator has become inactive. Under such market conditions, it is better to look for buy trades from the support levels near the moving average line. Sell positions can be considered from the resistance levels with short targets throughout the day.
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Alternative scenario: if the price breaks through the 1.3692 support level and consolidates below, the bearish scenario will likely resume.
Japan’s revised industrial production hasn’t been changed over the past month. The Japanese Yen is highly correlated with the dollar index right now, but the USD/JPY price is trading in a wide corridor amid the strengthening of both currencies.
The main trend on the USD/JPY currency pair is bullish. But the Japanese yen has shown strength in recent days, which, together with the rise in the dollar index, led to the formation of a wide trading range, within which the price has consolidated. The MACD indicator has become inactive. Under such market conditions, traders should look for buy trades from the support level where buyers show initiative throughout the day. Sell positions should be considered on the lower time frames with short targets from the zones where sellers show initiative.
Alternative scenario: if the price falls below 109.43, the uptrend is likely to be broken.
The Canadian dollar is a commodity currency, so the USD/CAD currency pair is highly dependent on the dynamics of the dollar index and oil prices. By the end of yesterday’s trading session, the dollar index lost its positions while oil prices grew. As a result, the USD/CAD price has slightly decreased due to the strengthening of the Canadian dollar.
In terms of technical analysis, the trend on the USD/CAD currency pair is bearish. But the price has consolidated in a local correctional upward movement. The MACD indicator became inactive. Buy positions can be considered from the support levels where buyers show initiative, and only with short targets. It is better to look for sell positions from the resistance levels of a higher time frame.
Alternative scenario: if the price breaks through the 1.2812 resistance level and fixes above, the uptrend will likely resume.
by JustForex
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
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