EUR/USD: waiting for clues coming from Yellen

EUR/USD Current price: 1.1341

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The American dollar lost ground against most of its major rivals during the first half of the day, with the EUR/USD pair extending up to 1.1355 in the London session, helped by positive data coming from the Old Continent. The flash Markit PMIs showed that Germany's private sector continued expanded in August, with the manufacturing figure up to 53.6, above expected, but the services sector expanding at  a slower pace, resulting at 53.3 from previous 54.4. For the euro area, the economy grew at a steady pace in the same month, with the Markit Composite PMI up to a seven-month high of 53.3. Later on the day, however, data showed that the EU consumer confidence decreased for a third month in-a-row, plunging to -8.5.

In the US, New Home Sales unexpectedly rose in July to the highest level in almost nine years, with sales increasing 12.4% to a 654,000 annualized pace. The FX market, however, was unimpressed with the news, as the flash Manufacturing PMI for August came in at 52.1, missing expectations of 52.7 and below July's 52.9.

The EUR/USD pair retreated from the mentioned high during the US afternoon to settle around 1.1320, flat for a second consecutive day. Investors are waiting for the US Jackson Hole Symposium, where FED's head, Janet Yellen, may offer some fresh clues over a timing of the next rate hike in the country. In the meantime, the 4 hours chart shows that the price is stuck around a horizontal 20 SMA, while the technical indicators lack clear directional strength around their mid-lines, failing to anticipate what's next for the pair. Still, and as long as the price holds above 1.1300, the upside is favored, with a break above 1.1365, last week high, required to confirm an extension towards 1.1400 and beyond.

Support levels: 1.1320 1.1285 1.1240

Resistance levels: 1.1365 1.1400 1.1460

EUR/JPY Current price: 113.32

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The EUR/JPY pair ends the day marginally lower, confined to a tight 40 pips range this Tuesday, as both currencies have continued to move evenly against the greenback. The pair trades near its daily low of 113.27 by the end of the day, as US stocks trimmed most of their early gains ahead of the close. Technically, the 1 hour chart shows that the price is hovering with its 100 and 200 SMAs, both flat and with the longest around the daily low, but overall showing the absence of a clear directional trend. In the same chart, technical indicators head south within negative territory, maintaining the short term risk towards the downside. In the 4 hours chart, the price keeps pressuring a bearish 100 SMA, while the Momentum indicator holds flat around its 100 level, also reflecting the lack of directional strength, whist the RSI indicator heads lower around 46, anticipating some further declines for the upcoming sessions.

Support levels: 113.15 112.80 112.40

Resistance levels: 113.75 114.05 114.40

GBP/USD Current price: 1.3193

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The GBP/USD pair near a daily high set at 1.3209, level last seen on August 4th. The Sterling Pound benefited from early dollar's weakness, and from a recovery in oil prices after Monday's sell-off. There were no first-tier data releases in the UK, but the CBI Industrial Trend Survey for August came in better-than-expected, at -5 versus the -9 forecast. The pair has spent most of the American afternoon consolidating right below the 1.3200 level, but maintains the positive tone near-term, given that in the 1 hour chart, indicators head strongly north near overbought readings, whilst the 20 SMA maintains its bullish slope below the current price, providing a dynamic support around 1.3160. In the 4 hours chart, the price is a few pips below its 200 EMA, but well above the 20 SMA, while the Momentum indicator heads sharply higher within positive territory and the RSI stands around 69, all of which supports further advances, particularly on a break above 1.3220, the immediate resistance.

Support levels: 1.3160 1.3120 1.3090

Resistance levels: 1.3220 1.3250 1.3290

USD/JPY Current price: 100.14

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The USD/JPY pair traded as low as 99.93 this Tuesday, with subsequent bounces barely being enough for the pair to recover the 100.00 level. The Japanese yen held to its latest trend, as US Treasuries yields edged higher, with the 10-year benchmark up to 1.55%.  The release of a slightly encouraging  August flash Japan Manufacturing PMI, which came in at 49.6 from 49.3 in July, hardly affected the currency. Neither did news that the  government plans to spend 4.52 trillion yen to fund stimulus measures for the local economy under a second extra budget for fiscal 2016, according to government sources. The pair maintains a neutral stance in the short term, but remains dangerously close to the 100.00 critical support. In the 1 hour chart, the price is developing below a mild bearish 100 SMA, whilst the technical indicators inch higher within neutral territory. In the 4 hours chart, technical indicators are flat around their mid-lines, while the 100 SMA has extended its decline above the current price and currently stands around 101.10.

Support levels: 99.90 99.55 99.10

Resistance levels: 100.30 100.65 100.95

AUD/USD Current price: 0.7617

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The Australian dollar advanced at the beginning of the day, underpinned by NZD gains, this last fueled by comments coming from RBNZ Governor, Graeme Wheeler, who delivered a speech in which outlined reasons on why he doesn't see the need to take an aggressive approach to interest rates. The AUD/USD pair surged up to 0.7654 during European trading hours, as the dollar came under selling pressure, but plummeted to a daily low of 0.7615 mid American afternoon, as  US equities came off their daily highs. According to the 1 hour chart, the risk is towards the downside as the price broke back below its 20 SMA, now flat around 0.7640, while the technical indicators head sharply lower within negative territory. In the 4 hours chart, the price is also below a bearish 20 SMA, while the technical indicators turned south and are currently entering negative territory, supporting a downward extension on a break below 0.7600, a strong Fibonacci support.

Support levels: 0.7600 0.7570 0.7535

Resistance levels: 0.7640 0.7690 0.7735