EUR/USD Current price: 1.1126
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ECB's President, Mario Draghi, hammered the EUR by being far more dovish than what the market anticipated, triggering a 100 pips decline in the EUR/USD pair, down to 1.1106 so far today, a fresh 2-week low. The Central Bank lowered its growth and inflation forecasts as anticipated, and increased the issue share limit to 33% from previous 25%, although it will review it on a case-by-case basis. Additionally, the ECB indicated that it could expand its stimulus programs according to needs. With China representing no risk as per being close on holidays, European share markets are soaring alongside with a weaker EUR, and the 1 hour chart shows that the price has accelerated below its 20 and 100 SMAs, whilst the technical indicators reached oversold levels, where they stalled. In the 4 hours chart the bearish momentum is quite strong, although with US Nonfarm Payrolls in the way, the pair may enter in a consolidative stage from now on. Nevertheless the downside is favored with a break below 1.1100 exposing the 1.1050 price zone.
Support levels: 1.1100 1.1050 1.1010
Resistance levels: 1.1160 1.1200 1.1245
GBP/USD Current price: 1.5260
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The GBP/USD maintains its bearish tone, trading near the daily low set at 1.5234 reached early Europe following the release of poor UK Markit services PMI for August. The pair saw a short lived spike on EUR/GBP slide following the ECB, but the 1 hour chart shows that the risk remains towards the downside as the 20 SMA capped the advance around 1.5290, whilst the technical indicators continue to head lower below their mid-lines. In the 4 hours chart the Momentum indicator extends to lower weekly lows below the 100 level, the RSI indicator hovers around oversold levels, whilst the 20 SMA maintains a strong bearish slope well above the current level, supporting further declines ahead, towards the 1.5200/20 price zone.
Support levels: 1.5250 1.5220 1.5170
Resistance levels: 1.5290 1.5330 1.5360
USD/JPY Current price: 119.84
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The USD/JPY pair came under selling pressure as the EUR/JPY sells off following the ECB dovish stance, breaking below the 120.00 level early in the US session. The USD/JPY has failed to hold beyond the 120.35 on a short term advance beyond it during Asian hours, and the 1 hour chart shows that the price is now accelerating below its 200 SMA, whilst the technical indicators head sharply lower below their mid-lines, anticipating a continued decline towards 119.40, the 38.2% retracement of the latest 2 weeks decline. In the 4 hours chart the technical picture is also bearish, although the decline can be limited on rising stocks and ahead of tomorrow US employment data.
Support levels: 119.40 118.90 118.50
Resistance levels: 120.00 120.35 120.60
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