EUR/USD: fresh lows by Wall Street´s close point to a continued decline

EUR/USD Current price: 1.1135

Live Chart for the EUR/USD

Investors continued favoring the greenback this Tuesday, with the American currency extending its rally towards its monthly highs against most of its major rivals. Save-havens CHF and JPY suffered the most, whilst the Pound was the best performer against the USD. The EUR/USD pair fell down to 1.1131 its lowest in nearly three weeks, undermined by dismal European data. According to official releases, German inflation is expected to have risen by 0.4% in August 2016 and compared to a year before, while monthly basis, is expected to remain unchanged from July at 0.1%. Also, the EU Economic Sentiment indicator for August fell to 103.5 from previous 104.5, probably as a consequence of Brexit. In the US, however, August Consumer Confidence surged to 101.1, the highest is almost a year, from a downwardly revised reading of 96.7 in July.

The EUR/USD pair settled near the mentioned low, consolidating for most of the US afternoon in a limited range, as the market keeps waiting for some additional clues over a possible US rate hike. The country will release its Nonfarm Payroll report this Friday, which may fuel dollar's advance particularly if wages present a more solid advance. The 4 hours chart shows that technical indicators have lost bearish momentum around oversold readings, whilst the price is currently stuck around its 200 SMA, and below the 20 and 100 SMAs, all of which maintains the risk towards the downside. The immediate support now is 1.1120, a major static level, with a break below it opening doors for further slides down to the 1.0950 region, August low.

Support levels: 1.1120 1.1075 1.1040

Resistance levels: 1.1160 1.1200 1.1245

EUR/JPY Current price: 114.89

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The Japanese yen weakened during US trading hours, undermined by better-than-expected US Consumer Confidence figures, leading to an advance up to 114.93 in the EUR/JPY pair, a fresh August high. After trading in a well-limited range for over three weeks, the pair finally broke higher, as hope for a US rate hike before the year end  put the safe-haven currency under strong selling pressure, even despite the poor performance of Wall Street this Tuesday. Technically, the  1 hour chart shows that technical indicators have lost upward strength within overbought territory, supporting some consolidation ahead before the next directional move. Nevertheless, the upside is favored, as the price has moved well above its 100 and 200 SMAs, with the shortest accelerating north above the largest. In the 4 hours chart, technical indicators head sharply higher, entering overbought territory and with no signs of changing bias at the time being, while the price has surpassed its moving averages, for the first time since late July. The pair has a Fibonacci resistance around 115.00, the 38.2% retracement of the latest bullish run. Having held above the 61.8% retracement of the same rally, a recovery beyond that 38.2% retracement should support a steadier advance up to 118.46, July 21st daily high.

Support levels: 113.95 113.45 113.10

Resistance levels:  114.50 114.95 115.50

GBP/USD Current price: 1.3082

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The GBP/USD pair closed the day modestly lower, a few pips below the 1.3100 level, as money and credit data released in the UK was far from encouraging. Mortgage approvals fell in July to its lowest since January 2015, down to 60.912K from a previous downwardly revised 64.152K, while consumer credit grew by less than expected, and below the past six months' average, coming in at £1.181B. The pair advanced up to 1.3119 early US session, but reversed course after US confidence data, meeting selling interest at a critical Fibonacci resistance, the 38.2% retracement of its latest daily advance, broken at the beginning of this week. The 1 short term picture presents a modestly bearish tone, as in the 1 hour chart, the price is developing below a bearish 20 SMA, while the Momentum indicator stands flat around its mid-line, and the RSI indicator  consolidates around 45. In the 4 hours chart, the 20 SMA extended its decline well above the current level, approaching the mentioned 1.3120 region, while indicators head  south within negative territory, although with limited bearish momentum, favoring additional slides on a break below 1.3050 the immediate support.

Support levels: 1.3050 1.3020 1.2975

Resistance levels: 1.3120 1.3160 1.3200

USD/JPY Current price: 103.05

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The USD/JPY pair surged above 103.00 for the  first time in a month on broad dollar's strength, bolstered by speculation that the US Federal Reserve is getting ready to raise rates. Data coming from Japan at the beginning of the day showed that the unemployment rate came in at 3% in July, a 21-year low, whilst retail sales surged by 1.4% in the same month and compared to the previous month, beating expectations of 0.8% and above an upwardly revised figure of 0.3% in the previous month. Year-on-year, retail sales were down 0.2%, while the market was expecting a contraction of 0.9%. The pair fell down to a 101.74 on the news, but changed course afterwards, on high-yielders demand. Technically, the 1 hour chart shows that the price has been advancing steady, now well above its 100 and 200 SMAs, whilst indicators present strong bullish slopes within overbought territory, maintaining the risk towards the upside.  In the 4 hours chart, the price has broken above a horizontal 200 SMA for the first time in the month, while technical indicators head higher, also within overbought levels, supporting some further gains towards the 104.00 price zone.

Support levels: 102.75 102.30 101.90

Resistance levels: 103.30 103.65 104.00

AUD/USD Current price: 0.7505

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The AUD/USD pair  came under strong selling pressure this Tuesday, weighed by a strong decline in commodities at the beginning of the day that accelerated in US trading hours, and by Wall Street's poor performance. RBA assist governor Debelle is due to speak at the FX week in Asia during the upcoming session, and investors will be looking there for clues over what's next for the country's economic policy. In the meantime, and from a technical perspective, the pair is pressuring the 0.7500 figure, after failing to recover above a daily descendant trend line broken earlier this week.  Short term, the 1 hour chart shows that the price is well below a bearish 20 SMA, while indicators keep heading lower, despite being in extreme oversold levels. In the 4 hours chart, the 20 SMA heads strongly lower, now converging with the mentioned broken trend line around 0.7570, while technical indicators continue heading lower, also within oversold territory, supporting some further slides towards 0.7450.

Support levels: 0.7490 0.7450 0.7410

Resistance levels: 0.7535 0.7570 0.7610