Today’s Forex Guide

Weekly Wrapup


Sep.12.2014

The week is ending and the currency pairs seem to have entered an early TGIF mode as they are barely moving.

Brown paper package with torn section

Scotland's Yes campaign does appear to have lost its edge over the last couple of opinion polls. Overnight the YouGov poll showed a 48/52 split in favor of the Better Together campaign, which has perhaps justified David, Nick and Ed's expenses bill north of the border earlier in the week.

The market has seen little reaction to the poll, as it consolidated the previous night's Survation poll.

In Europe, Mario Draghi took aim at the Germans yesterday urging for more investment programs. Berlin dashed the hopes of Paris when they vetoed the concept of a joint public-private multi-national investment program, despite being one of the only countries in Europe that could actually afford to do something like that. Mario Draghi said "it may be useful to have a discussion on the overall fiscal stance of the euro area with a view to raising public investment where there is fiscal space to do so" ( loosely translated; if you can afford to spend it, spend it.)

In the US there is more debate over when the Fed will raise rates. It seems the previous rise in hawks has reversed to a point and many now see nothing until the end of the second quarter at least.

Overnight, Asian markets have continued their recent downward trend, which looks like it's going to be the longest losing streak since 2010. Japan is the exception to the rule as the Yen's depreciation continues to boost the Nikkei share index. The recent moves lower in the currency could even boost profits for the country's largest exporters by as much as $3.5bn in this financial year, as they repatriate income at a rate that's now 7% better for them than where the year started.

Data today includes UK construction output, but will probably focus on European employment statistics and industrial production numbers from the region. this afternoon we've got US retail sales, which is always a hot topic and we close out with the University of Michigan survey. On the speaking slate we've got a Eurogroup meeting kicking off this morning with a press conference at lunchtime and also Jens Weidmann, Germany's central bank chief and Mario Draghi's main opponent when it comes to looser monetary policies.

Intraday Forex Technical Levels


EUR/USD 4-hour Forex Dance Floor

EUR/USD 4-hour: Consolidating.

Invest Diva Likes: Short positions below 1.2947 with targets at 1.2874 and 1.281 in extension.

If Pair Goes Nuts: Above 1.2947 look for further upside towards 1.3020 and 1.3142.

What's up on the Forex Dance Floor: The pair is on an overall downtrend but is now consolidating below the Ichimoku's cloud between the levels at 1.2947 and 1.2874. The RSI remains in the neutrality area. The intraday market sentiment seems to be on the downside on the final day of the week.

Supports and Resistances
1.3142

1.3020

1.2947 Pivot Point

1.2874

1.2818

GBP/USD 4-hour Forex Dance Floor

GBP/USD 4-hour: Consolidating.

Invest Diva likes: Short positions below 1.6236 with targets at 1.6155 and 1.6060 in extension.

If pair goes nuts: Above 1.6236 look for further upside towards 1.6327 and 1.6446.

What’s up on the forex dance floor: The pair is on an overall downtrend and currently teasing a previous support level turned into resistance at 1.6236 below the Ichimoku cloud after rebounding from a key support level. The pair could soon enter the Ichimoku's cloud which is a signal for more consolidation. The RSI is just above the neutrality area.

Supports and resistances
1.6446

1.6327

1.6236 Pivot point

1.6155

1.6060

USD/JPY 4-hour Forex Dance Floor

USD/JPY 4-hour: Testing the resistance level at 107.36.

Invest Diva Likes: Long positions above 107.36 with targets at 107.50 and 108 in extension.

If Pair Goes Nuts: Below 107.36 look for further downside towards 106.72 and 106.34.

What's up on the Forex Dance Floor: The pair is on an overall uptrend above the Ichimoku's cloud and is now teasing a previous support from back in November 2007 now turned into resistance at 107.36 with the RSI in overbought zone.

Supports and Resistances
108

107.50

107.36 Pivot point

106.72

106.34

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