Forex Update – 30 Oct 2019

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By: Ahura Chalki

Banks in action!

US:

A very important day for the US economy this week, since FED rate decision, GDP and employment data, all are going to be realized this week, today and net two days. Later today we will have GDP, which is projected to ease to 1.6%, lower than last quarter at 2.00%. On the other hand, investors are pricing so much on rate cute, for a minimum of 25bp, especially after negative Consumer confidence data of yesterday. For now, DXY is moving flat with a desire of trending south. With lower than expected GDP and rate cut, we need to wait for more decline in the USD rate, especially with breaking the $97.30 and later 97.10, two key support levels.

EU:

Ahead of the Business climate index from the EU zone, the German negative employment data added more pressure on the Euro. Earlier released data shows unemployment raised by 6K, comparing with 2K forecasted, however the unemployment rate still steady at 5%. The largest economy of the EU zone will realize the CPI data later today, which will be in the spotlight by traders, which is forecasted to ease.

Canada:

The interest rate decision by BOC will be in the spotlight for the Loonie. It is expected to hold the same monetary policy and interest rate from BOC, which will help the Loonie to rise against the main currencies in a short time. Moreover, temporary shutdowns in oil and gas extraction restrained GDP growth in July — a return to more typical production levels should provide more support for CAD as well.

EURUSD

S1

S2

S3

R1

R2

R3

1.1084

1.1056

1.1038

1.1130

1.1148

1.1176

 

Uncertain USD rate effect directly in pairing, since we have GDP and FED data ahead, later today. Volatility, market is projected for today. 1.1100, EMA50 at H4 chart, still playing a key support level role. On the other hand, EMA100 at 1.1120 is immediate resistance level. Based on the high volatility market, trading with key support and resistance levels, as well as provided S and R levels above is safer, today.

EURGBP

S1

S2

S3

R1

R2

R3

0.8612

0.8588

0.8569

0.8655

0.8674

0.8698

 

Breaking a key level of 0.8624 has set the S1 at 0.8612 is more likely available in a short time. In the Both H1 and H4 chart, RSI moves under 50-level, confirming more bearish for now, while Stochastic also confirming that with breaking the signal line with its mainline. The market volume also trending lower with the downtrend, supporting the bears.

EURJPY

S1

S2

S3

R1

R2

R3

120.68

120.37

120.17

121.19

121.39

121.70

 

Returned into bullish against EUR, since JPY is losing the ground, based on fewer requests for safe-haven. Holding above 121.00 as a key psychological level for this pairing will push the bulls ahead. RSI moves above 55-level, while candles clearly forming above EMA50 & 20. 122.16, 200-day period SMA is a key resistance level and next target for bulls if it comes into power. 119.91 as key support level, can change the trend if pairing break this level.

USDJPY

S1

S2

S3

R1

R2

R3

108.75

108.62

108.48

109.02

109.15

109.28

 

Technical indicators have mixed signals. While Parabolic SAR supports bulls at the H1 chart, RSI cannot confirm that with flat movement at 48-level. For the second day in a row, candles are forming between the Middle and lower band of BB. 108.80 is immediate support which sits on the lower band of BB, moving above this level, can confirm the next bullish trend, while breaking that, will be the confirmation of continuing of the current downtrend.

GBPUSD

S1

S2

S3

R1

R2

R3

1.2813

1.2758

1.2711

1.2914

1.2961

1.3016

 

               As Brexit fate is clearer now and election date also has been approved by parliament, for now on economic data will have more effect on Sterling. As Pound by itself, projected to have natural movement, however since pairing depends on another side as well, USD will lead the market, for now, easing in the USD rate will be the market mover. Breaking key resistance level at 1.3000 can push the trend up to May 5 high at 1.3170, immediate support level sits at 1.2740, while 1.25 still is a key Support level.


Risk Warning: Trading-Leveraged Products such as Forex and Derivatives may not be suitable for all investors as they carry a high degree of risk to your capital. Please ensure that you fully understand the risks involved, taking into account your investment objectives and level of experience, before trading, and if necessary, seek independent advice.

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