Bank holiday on Monday in the US and Canada didn’t leave much room for Ms. USA to dance around, and the fate of the major currency pairs was mostly left to her major counterparts.
USD/JPY Daily: Rebounding towards key Fibonacci level
Mr. Japanese Yen has definitely taken the lead on the USD/JPY pair and the pair appears to be heading down to key Fibonacci levels after breaking the 23% level last week. This could be one of those famous technical patterns where a strongly trending pair pulls back towards the 50% fibo before shooting back up.
This 50% Fibonacci coincides with a previous top back in 2008 which makes it even more important so a break below this level at 105.561 could open doors for more drops towards 104.560. Alternative scenario is waiting for a rebound above 105.561 with bullish targets set at 109 and 110.
EUR/USD, GBP/USD and AUD/USD are seeing very similar patterns to one-another as they struggle to rebound from their most recent down-trend.
EUR/USD Daily: Moving down on negative data
EUR/USD remains below the Ichimoku cloud while the MACD indicator crossed above the Signal line, creating confusion on the forex dance floor. The pair failed the break above the resistance level at 1.2785 in its most recent rebound attempt last week and we could see more drops with 1.2515 and 1.2350 as targets. A break above this level would change our outlook to bullish with 1.3100 as first alternative target.
Market News
- Tuesday morning, both euro zone industrial output and the ZEW indicator of German investor sentiment came in well below forecasts.
- Concern over growth has already driven back expectations for a rise in UK interest rates well into next year. Some analysts who only weeks ago were talking up a rise next month are now saying it may not come until the second half of next year.
- Eurostat in Luxembourg said industrial production in the euro area declined 1.8 percent in August, matching September 2012’s level which was the least since 2009.
- Wednesday is Mr. Draghi’s day as he will speak twice, once at 8 am and once at 7 pm GMT.
Intraday Forex Technical Levels
GBP/USD 4-hour: Broke below the Ichimoku’s cloud.
Invest Diva Likes: Short positions below 1.5959 with targets at 1.5866 and 1.5787 in extension.
If Pair Goes Nuts: Above 1.5959 look for further upside towards 1.6084 and 1.6162.
What’s up on the Forex Dance Floor: The pair broke down the Ichimoku’s cloud and also reached the previous bottom around the level at 1.5959. The RSI is teasing the oversold zone.
Supports and Resistances
1.6162
1.6084
1.5959 Pivot Point
1.5866
USD/CHF 4-hour: Reaching the resistance level.
Invest Diva Likes: Long positions above 0.9573 with targets at 0.9689 and 0.9745 in extension.
If Pair Goes Nuts: Below 0.9573 look for further downside towards 0.9491 and 0.9392.
What’s up on the Forex Dance Floor: The pair is expected to form a Double Bottom pattern and is now reaching its possible neckline at 0.9573 and Ichimoku’s cloud. The RSI is heading to the neutrality area.
Supports and Resistances
0.9745
0.9689
0.9573 Pivot Point
0.9491
0.9392
EUR/JPY 4-hour: Moving down.
Invest Diva Likes: Short positions below 135.25 with targets at 134.73 and 134.30 in extension.
If Pair Goes Nuts: Above 135.25 look for further upside towards 135.70 and 136.63.
What’s up on the Forex Dance Floor: The pair is moving down a brief rebound below the Ichimoku’s cloud. The RSI is just above the over-sold zone.
Supports and Resistances
136.63
135.70
135.25 Pivot Point
134.73
134.30
USD/CAD 4-hour: Challenging the previous top.
Invest Diva Likes: Long positions above 1.1256 with targets at 1.1277 and 1.1300 in extension.
If Pair Goes Nuts: Below 1.1256 look for further downside towards 1.1158 and 1.1097.
What’s up on the Forex Dance Floor: The pair is on an overall uptrend and teasing the previous top level at 1.1256 above the Ichimoku’s cloud. We’re waiting for confirmation whether the pair would break the level or rebound. The RSI is reaching the overbought zone.
Supports and Resistances
1.1300
1.1277
1.1256 Pivot Point
1.1158
1.1097
Intraday Commodities Technical Levels
Dow Jones Intraday: the downside prevails.
Invest Diva likes: Short positions below 16530 with targets at 16160 and 16070 in extension.
Alternative scenario: Above 16530 look for further upside with 16680 and 16820 as targets.
Gold spot Intraday: supported by a rising trend line.
Invest Diva’s likes: Long positions above 1225 with targets at 1242 and 1250 in extension.
Alternative scenario: Below 1225 look for further downside with 1215 and 1202 as targets.
Crude Oil Intraday: under pressure.
Invest Diva’s likes: Short positions below 86.3 with targets at 83.6 and 82 in extension.
Alternative scenario: Above 86.3 look for further upside with 87.98 and 90.35 as targets.
#1 Best Selling Author. Helping you accelerate your retirement with Triple Compounding™ Former engineer on a mission to help 1 million households take control of their finances. Founder & CEO of Invest Diva.
