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USD/CHF: Franc is falling
Current trend
The Swiss Franc continues falling against the USD, which is the result of increased risk appetite on the markets due to relative stabilisation on the Chinese stock market and European stock indices growth.
In addition, the Franc was pressured on Tuesday by the labour market statistics from Switzerland. The Unemployment Rate without seasonal adjustment grew from 3.1% to 3.2%, while the number of unemployed in August increased from 134 thousand to 137 thousand, which was worse than forecasts.
Support and resistance
Bollinger Bands on the daily chart is turning horizontally, while the price range is widening from upside thus allowing the pair to grow to new local highs. MACD is growing and giving a buy signal. Stochastic remains in the overbought zone, thus indicating a possibility of a downward correction within next few days.
The indicators recommend keeping existing long positions, but wait for a clearer signal before opening new ones.
Support levels: 0.9769 (3 September high), 0.9717, 0.9688, 0.9649, 0.9600, 0.9568 (1 September low), 0.9524, 0.9500.
Resistance levels: 0.9800 (local high), 0.9820, 0.9862, 0.9900 (11 August high), 0.9930.
Trading tips
Long positions can be opened after the price consolidation above the level of 0.9800 (with the appropriate indicators signals) with targets at 0.9900, 0.9930 and stop-loss at 0.9720, 0.9700.
Short positions can be opened after the price rebound from the level of 0.9800 with targets at 0.9700, 0.9600 and stop-loss at 0.9860.
USD/JPY: general review
Current trend
Since today’s opening, the USD/JPY pair is growing.
The pair was supported by the statement of the Chinese government that the they are ready to apply additional measures to support the economy if required. At the same time, according to Xinhua, direct investment in China in August grew by 22%.
The pair also received a support from the statement by the head of the Bank of Japan that the regulator is going to continue with its QE program.
Today attention needs to be paid to the data on Jobless Claims for the first week of September in the US.
Support and resistance
The USD/JPY pair rebounded from the support level at 120.50 (61.8% Fibonacci) and grows towards 121.50 (50% Fibonacci, the zone of EMA144 and EMA200 on the 4-hour chart). If the trend continues, the pair will head towards 122.00 (EMA50 on the daily chart), 122.50 (38.2% Fibonacci). The trend is going to reverse once the price consolidates below the levels of 120.50, 119.50.
OsMA and Stochastic on the 4-hour and daily charts give buy signals.
Support levels: 118.40, 119.50, 120.00, 120.50.
Resistance levels: 121.50, 122.00.
Trading tips
Open long positions from the levels of 120.70, 120.85 with targets at 121.00, 121.20, 121.50, 121.90 and stop-loss at 119.85.
Pending sell orders can be placed at the level of 119.80 with targets at 119.50, 119.10, 118.40 and stop-loss at 120.60.
EUR/USD: general analysis
Current trend
On Thursday, despite positive Initial Jobless Claims statistics, the USD lost 72 points against the EUR. The main factor, affecting the US currency, remains the uncertainty over the timing of the interest rate rise. Due to recent negative events on global markets, the Federal Reserve may delay the first rate hike.
Today, it is worth noting the US Producer Price Index for August, which is expected to come in 0.1% lower than in the previous month, or 0.9% lower on a year-over-year basis. Consumer Sentiment Index is forecasted to decline to 91.2 points from 91.9 earlier. Negative statistics may prevent the USD from strengthening at the end of the week.
As for the eurozone, Germany releases its Consumer Price Index and the Economic and Financial Affairs Council holds a meeting, results of which may influence the EUR dynamics.
Support and resistance
On the 4-hour chart, the price reached the upper border of the Bollinger Bands indicator and is likely to turn down in the short run.
MACD, on the contrary, indicates a further upward movement. The histogram is in the positive zone, above its signal line.
The nearest support levels are 1.1171, 1.1093.
The nearest resistance level is 1.1318.
Trading tips
Long positions can be opened from the level of 1.1325 with the target at 1.1395 and stop-loss at 1.1300.
Short positions can be opened from the level of 1.1165 with the target at 1.1100 and stop-loss at 1.1190.
USD/CAD: moderate decline
Current trend
Since opening of the trading session, the CAD is strengthening despite falling oil prices.
Nevertheless, a decline in GDP, crisis in some sectors of Canada’s economy, loose monetary policy led by the Bank of Canada as well as negative oil price forecasts affect the national currency.
In the week ahead, market participants will be turning their attention to the US Interest Rate Decision, due on Thursday, and to the statements, made during the Federal Reserve Press Conference. Regardless of Fed’s decision, the USD/CAD pair is likely to strengthen.
Support and resistance
By the opening of the European session, the USD/CAD pair declined by nearly 30 points.
During a downward correction, the pair may reach the levels of 1.3185 (ЕМА144), 1.3135 (ЕМА200 on the 4-hour chart). If the price declines below 1.3050, it may move further down to the level of 1.2800, after the breakdown of which a downward trend would start.
However, the fundamental factors suggest a further growth to 1.3500 in the medium term and to 1.4000 (2004 year highs) in the long term.
Support levels: 1.3050, 1.3135, 1.3185, 1.3200.
Resistance levels: 1.3300, 1.3350.
Trading tips
Place pending buy orders from the levels of 1.3190, 1.3145 with stop-loss at 1.3110 or from the level of 1.3260 with stop-loss at 1.3210. Target levels are 1.3290, 1.3350.
GBP/USD: general analysis
Current trend
The GBP has been under pressure since last week, when Trade Balance and Industrial Production statistics were released in the UK. The balance between exports and imports of goods came in at -3.371 billion pounds from -1.508 billion earlier and against the forecast of -1.9 billion. Industrial Production had been expected at 1.4% on a year-on-year basis, but a decline from 1.5% to 0.8% followed. On a monthly basis, the indicator remained at -0.4% against the forecast of 0.1%.
Consumer Price Index is due today. In case of a positive reading, the price is likely to consolidate at recent highs 1.5469.
Support and resistance
The price consolidated above the Fibonacci correction level 38.2% and may move up to the correction level 50.0%.
Support level is 1.5371 (yesterday low).
The nearest resistance level is 1.5470 (last week and yesterday high).
Trading tips
Long positions can be opened from the level of 1.5413 with the target at 1.5470 and stop-loss at 1.5371.
EUR/USD: general analysis
Current trend
On Tuesday, the EUR/USD pair was declining amid the publication of negative ZEW Economic Sentiment Index. In August, Germany’s Economic Sentiment dropped from 25.0 to 12.1, while the eurozone’s index fell from 47.6 to 33.3. Moreover, the USD gained some support from Retail Sales statistics for August, released in the US, which indicated a 0.2% increase in August.
Today, Consumer Price Index statistics are due in the eurozone and the US. Both in the eurozone and the US, the indicators are expected to come in at 0.0% on a monthly basis and grow by 0.2% on a year-on-year basis.
Only a difference between the actual data and the forecasts may change the pair dynamics. At present, market participants are turning their attention to the forthcoming Fed’s meeting.
Support and resistance
On the 4-hour chart, the price has turned up at the lower MA of Bollinger Bands and is likely to grow in the short run.
MACD histogram is in the positive zone and below its signal line, indicating, on the contrary, a possible downward movement.
The nearest support levels are 1.1171, 1.1093.
The nearest resistance levels are 1.1318, 1.1360.
Trading tips
Long positions can be opened from the level of 1.1320 with the target at 1.1355 and stop-loss at 1.1300, as well as from the level of 1.1365 with the target at 1.1410 and stop-loss at 1.1340.
Short positions can be opened from the level of 1.1165 with the target at 1.1100 and stop-loss at 1.1190.
EUR/USD: general analysis
Current trend
On Tuesday, the EUR/USD pair was declining amid the publication of negative ZEW Economic Sentiment Index. In August, Germany’s Economic Sentiment dropped from 25.0 to 12.1, while the eurozone’s index fell from 47.6 to 33.3. Moreover, the USD gained some support from Retail Sales statistics for August, released in the US, which indicated a 0.2% increase in August.
Today, Consumer Price Index statistics are due in the eurozone and the US. Both in the eurozone and the US, the indicators are expected to come in at 0.0% on a monthly basis and grow by 0.2% on a year-on-year basis.
Only a difference between the actual data and the forecasts may change the pair dynamics. At present, market participants are turning their attention to the forthcoming Fed’s meeting.
Support and resistance
On the 4-hour chart, the price has turned up at the lower MA of Bollinger Bands and is likely to grow in the short run.
MACD histogram is in the positive zone and below its signal line, indicating, on the contrary, a possible downward movement.
The nearest support levels are 1.1171, 1.1093.
The nearest resistance levels are 1.1318, 1.1360.
Trading tips
Long positions can be opened from the level of 1.1320 with the target at 1.1355 and stop-loss at 1.1300, as well as from the level of 1.1365 with the target at 1.1410 and stop-loss at 1.1340.
Short positions can be opened from the level of 1.1165 with the target at 1.1100 and stop-loss at 1.1190.
USD/CHF: pair fell
Current trend
On Wednesday, the USD fell against all major currencies across the market, as well as against the Franc as it reacted to poor data on the Consumer Price Index from the US. This index is extremely important for the GDP growth estimation, especially now before the key Fed meeting on Thursday.
On top of that, on Wednesday strong ZEW Survey – Expectations data from Switzerland supported the Franc. In September, the index grew from 5.9 to 9.7 points, which was a lot higher than forecasts.
Support and resistance
Bollinger Bands on the daily chart is directed horizontally, while the price range is narrowing slightly from below. MACD is moving downwards and giving a weak sell signal. Stochastic bounced off the oversold zone and turned upwards.
The indicators recommend waiting for a clearer trading signal.
Support levels: 0.9688 (local low), 0.9649, 0.9600, 0.9568 (1 September low), 0.9524, 0.9500, 0.9460, 0.9400, 0.9330, 0.9300, 0.9257 (24 August low).
Resistance levels: 0.9717 (local high), 0.9762 (15 September high), 0.9800, 0.9822 (9 September high).
Trading tips
Long positions can be opened after the price returns to the level of 0.9700 with targets at 0.9745, 0.9800 and stop-loss at 0.9660.
Short positions can be opened after the price consolidation below the level of 0.9650 with targets at 0.9610, 0.9550 and stop-loss at 0.9690.
USD/JPY: mixed dynamics
Current trend
Yesterday the USD/JPY pair was strengthening amid poor macroeconomic statistics form Japan and strong labour market data from the US. However, after the publication of the Fed decision to keep interest rates at current 0.25% the pair dropped.
Nevertheless, poor data from Japan is supporting the pair. Country’s exports for August grew at only 3.1% against the previous figure of 7.6%, while imports shrank by 3.1% instead of a forecasted 2.2% fall. The country’s trade deficit in August, therefore, grew to 569.7 billion Yen, against 268.4 billion Yen for July.
Support and resistance
Bollinger Bands on the daily chart is moving horizontally. MACD is turning down and giving a sell signal. Stochastic is also falling.
The indicators recommend sales in the short-term.
Support levels: 119.21, 118.59 (4 September low), 118.24, 117.00, 116.19 (24 August low).
Resistance levels: 120.00 (psychologically important level), 120.69, 121.32 (10 September high), 121.73 (28 August high), 122.00, 122.60.
Trading tips
Short positions can be opened after the price consolidation below the level of 120.00, and after the breakdown of the level of 119.21 (with the appropriate indicators signals) with the target at 118.24 and stop-loss at 120.69. Validity – 1-2 days.
Long positions can be opened after the price rebound from the level of 119.21 with stop-loss at 118.60, and from 120.00 with stop-loss at 119.00, with target at 121.32, 122.00. Validity – 2-3 days.
EUR/USD: general analysis
Current trend
Last week, the Federal Reserve decided to keep its interest rates unchanged that negatively affected the USD. As a result, the EUR hit new month high at the level of 1.1459. However, at the end of Friday’s session, the USD gained back almost all its losses. The Fed still considers a possibility of a rate hike later this year if given further improvement in the labor market and inflation growth.
Today, the volatility in the EUR/USD pair is expected to be low; however, it is worth noting the publication of Existing Home Sales statistics in the US. The indicator is expected to decline by 60K from the previous month to 5.53 million. If the actual data comes out higher that the forecast, the USD may strengthen.
Support and resistance
On the 4-hour chart, the pair is trading between the middle and the lower MAs of Bollinger Bands. The indicator is giving no clear trading signals. MACD histogram is in the positive zone, below its signal line, indicating that the pair is likely to turn down.
The nearest support levels are 1.1171, 1.1093.
The nearest resistance level is 1.1450.
Trading tips
Open long positions from the level of 1.1350 with the target at 1.1435 and stop-loss at 1.1320.
Open short positions from the level of 1.1245 with the target at 1.1185 and stop-loss at 1.1270.