EUR/USD Current price: 1.1181
The American dollar remained buoyed in thin Monday trading, edging higher against most of its major rivals. The week started once again in slow motion, with a scarce macroeconomic calendar, and London closed due to a local holiday. The US released a critical piece of macroeconomic data, FED's favorite measure of inflation, the PCE. Headline Personal Consumption Expenditures came in at an annualized 0.8% in July, but below a previous reading of 0.9%. Core PCE increased 1.6% compared to a year before, beating expectations for a 1.5% print Personal Spending and Income matched expectations, at 0.3% and 0.4% respectively. Despite inflation continues to track below the Central Bank's target of 2%, the figures supported the hawkish rhetoric presented by Yellen last Friday, on an upcoming rate hike.
The EUR/USD pair fell down to 1.1157, bouncing modestly in the US afternoon, but closing the day below the 1.1200 level, overall maintaining the bearish tone developed last Friday, despite recovering from a fresh 2-week low. The 4 hours chart shows that the technical indicators are bouncing modestly from oversold territory, but lack momentum, reflecting limited buying interest around the pair. In the same chart, the 20 SMA, heads lower around 1.1245, reinforcing the static resistance area and the level to surpass to see the ongoing trend changing course. Renewed selling interest below 1.1160, on the other hand, should see the pair extending its decline down to the 1.1070/80 region.
Support levels: 1.1160 1.1120 1.1075
Resistance levels: 1.1245 1.1290 1.1335
EUR/JPY Current price: 114.12
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The EUR/JPY pair advanced up to 114.68, its highest in almost a month amid yen's weakness at the beginning of the day, but gave up most of its daily gains to close the day flat, a few pips above the 114.00 mark. The short term picture for the pair is neutral, given that in the 1 hour chart, technical indicators present sharp bearish slopes within bearish territory, albeit the price is holding its 100 and 200 SMAs, both converging around 113.40/50. In the 4 hours chart, the price was unable to extend beyond a horizontal 200 SMA, but indicators have resumed their advances within positive territory and after correcting overbought conditions, maintaining the downside limited. A bearish acceleration below 114.00, the 50% retracement of the latest weekly rally, should support a continued decline for this Tuesday, with scope then to return to the 113.00 region.
Support levels: 113.95 113.45 113.10
Resistance levels: 114.50 114.95 115.50
GBP/USD Current price: 1.3092
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The GBP/USD pair broke below the 1.3100 level and fell down to 1.3059, its lowest in a week, as dollar's demand persisted this Monday. The pair recovered some ground in the US session, but held below the mentioned 1.3100 figure by the end of the day around it. There were no fundamental news in the UK, as local banks remained close in observance of the Summer Bank Holiday, and the kingdom will only release its Money Supply figures on Tuesday, hardly a market mover. From a technical point of view, the pair has corrected the 50% of its latest advance, measured between 1.2865 and 1.3278, before bouncing, but the risk remains towards the downside, given that in the 1 hour chart, the price is being capped by a modestly bearish 20 SMA, while indicators aim higher, but within negative territory. In the 4 hours chart, the 20 SMA has turned strongly lower far above the current level, around 1.3160, while indicators have posted modest recoveries within bearish territory, still far below their mid-lines. The 38.2% retracement of the mentioned rally comes at 1.31230, now the immediate resistance and the level to break to see the pair recovering further.
Support levels: 1.3070 1.3025 1.2985
Resistance levels: 1.3120 1.3160 1.3200
USD/JPY Current price: 101.05
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The USD/JPY pair retreated from a daily high of 102.37, to end the day a few pips below the 102.00 figure, flat daily basis, as the dollar lost momentum in the American afternoon. The recovery has brought some relief to Japanese authorities, as the pair's downward potential, and its ability to rally below the 100.00 critical level has been faded. Nevertheless a stronger recovery is yet to be seen, and will continue depending on what both Central Banks may decide this September. In the short term, the 1 hour chart shows that indicators have completely erased their overbought conditions, with the Momentum now heading south below its 100 level and the RSI indicator flat around 55. In the same chart, the 100 SMA gains upward slope around 100.90, and above the 200 SMA. In the 4 hours chart, technical indicators are retreating from overbought territory, indicating a possible downward corrective movement ahead, with the immediate short term support now at 101.60.
Support levels: 101.60 101.20 100.75
Resistance levels: 102.40 102.85 103.30
AUD/USD Current price: 0.7576
View Live Chart for the AUD/USD
The AUD/USD pair recovered from a daily low of 0.7524 to close the day with nice gains around 0.7575, underpinned by Wall Street's rally. Nevertheless, the pair continues trading below the critical 0.7600 level, and further recoveries will depend on whether the pair can regain that level. Australian will release its July Building Permits during the upcoming Asian session, expected to have improved from the previous month, although data may disappoint, as New Home Sales, released early Monday, plunged 9.7% in July, declining for the third time in four months and pointing to a continued downtrend in the housing sector. The 1 hour chart shows that the price is currently developing above a modestly bullish 20 SMA, while technical indicators have lost their upward momentum and turned flat within positive territory. In the 4 hours chart, the 20 SMA and the 200 EMA converge around 0.7600, also a Fibonacci resistance, while technical indicators continue recovering from near oversold readings, but remain below their mid-lines, supporting the theory of a break above 0.7600 required to confirm further gains.
Support levels: 0.7535 0.7490 0.7450
Resistance levels: 0.7600 0.7640 0.7690
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