Best Thread FXCM/DailyFX Signals and Strategies

[Jason Rogers]

British Pound Nears August High – Support Down to 16250

Written by Jamie Saettele of DailyFX.com

The GBPUSD has held its low above 16100 and there is potential for a strong breakout in the coming days and weeks above 16745. Ultimate objectives are channel resistance and several Fibonacci extensions at 17183 and 17409. Near term, expect support at 16300 and 16250.

 

[Jason Rogers]

Gold Still Bullish; Support at 1765

Written by Jamie Saettele of DailyFX.com

“Analyzing structure from the July low suggests that a series of 4th and 5th waves should unfold. In other words, gold is headed higher but with corrections along the way.” The latest correction ended just before the former 4th wave extreme at 1720 and price is expected to reach a new before the next 4th wave begins. Look higher. 1765 is short term support.

300 Minute Bars

 

[Jason Rogers]

Euro Bulls Turned Back Again Shy of 14500

Written by Jamie Saettele of DailyFX.com

I favor a EURUSD run into the 15000s over the next few months but it doesn’t make sense to get long until price either exceeds 14516 or there is sufficient evidence to suggest that the correction is complete at lower levels. The above count, in which a b wave triangle has been unfolding since the May low, is one of many possibilities at the current juncture.

Daily

 

[Jason Rogers]

USD Breaks Out Of Bearish Pattern

Written by David Song of DailyFX.com

The Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) is 0.46% higher from the open after moving 69% of its average true range, and the greenback may continue to appreciate throughout the North American trade as market participants scale back their appetite for yields. As the economic docket remains pretty bare for the remainder of the day, risk sentiment should heavily influence the USD, but the reserve currency looks poised to consolidate going into the end of the week as the relative strength index approaches overbought territory. In turn, the break above the upper bounds of the Bollinger Band is likely to be short-lived, but comments from Fed Chairman Ben Bernanke likes to heavily influence future price action for the USD as investors weigh outlook for monetary policy.

DJ FXCM Dollar Index

 

[Jason Rogers]

Fed Minutes, Nonfarm Payrolls on the Horizon

Written by Christopher Vecchio of DailyFX.com

Following a week marked by weak volume at some points and immense volatility at others, the last week of August looks to provide more the same as the economic docket is packed with historically market moving events. Significant data from across the G-7 countries are due over the course of the week, culminating in a critical labor market report for the world’s largest economy.

USD Consumer Confidence (AUG): August 30 – 14:00 GMT
Consumer confidence is expected to remain below 60.0, after falling back below the key level in June. July’s reading was slightly improved at 59.5, but not a significant increase to suggest that confidence has started to rebound, especially considering the forecast number, 52.0, according to a Bloomberg News survey. The recent string of disappointing data out of the United States, including disparaging labor market data, a grueling debt ceiling debate that divided the country politically, and a recent turn lower in equity markets is likely to continue to weigh on sentiment for a considerable amount of time as there are few signs of optimism. The worsening debt crisis in Europe is likely to have an increasing effect on consumer confidence, in a ‘trickle-down’ sort of way; as equity markets continue to head lower on contagion concerns, sentiment will deteriorate, despite the fact that the influence is mostly exogenous.Join a DailyFX analyst for live coverage of event!

CAD Gross Domestic Product Annualized (2Q): August 31 – 12:30 GMT
Canadian gross domestic product data has tailed-off, with last month’s growth rate falling to a paltry -0.3 percent pace. The negative growth is expected to be reflected in the next release, on Wednesday, when the quarterly figure, on an annualized basis, is expected to show no change – flat growth at 0.0 percent, according to a Bloomberg News survey. Despite economic data out of the world’s eleventh largest economy, and a considerably weakening Canadian Dollar as risk-aversion has picked up on slowed global growth concerns as well as the European sovereign debt crisis, it appears that the global slowdown is weighing on Canada. Still, with an improving labor market – the Canadian economy is the only major economy to have regained and added jobs since the recession – Canada is insulated, for the time being, from the financial storm that is starting to gather. Join a DailyFX analyst for live coverage of event!

EUR German Gross Domestic Product n.s.a. (YoY) (2Q F): September 1 – 06:00 GMT
Last month, I wrote “[F]orecasts suggest that second quarter growth in Germany has slowed considerably, according to a Bloomberg News survey. The gross domestic product reading is expected to print at 3.2 percent, on a year-over-year basis. While this is still a very strong reading, it is well below the 5.2 percent growth Germany experienced in the first quarter.” The forecasts were wrong, with the actual reading showing 2.8 percent growth on a yearly basis. That being said, a downward revision is possible, as global growth has slowed, and any further weakening by Europe’s largest economy will bring out the doves, calling for the European Central Bank to cut rates in order to help sustain growth in an eroding economic environment. Join a DailyFX analyst for live coverage of event!

USD Change in Non-farm Payrolls, Unemployment Rate (AUG): September 2 – 12:30 GMT
According to a Bloomberg survey, economists have forecasted that August data will show an increase of 75K in U.S. nonfarm payrolls figure, the American index of the labor market. The July figure came in at a disappointing117K print, despite beating expectations. A slew of disappointing data releases over the past month coupled with economists largely missing the target on this indicator recently suggests that another miss on the data is possible.Accordingly, economists expect the rate to remain at 9.1 percent. Last month, the unemployment rate dropped to 9.1 percentbeating economists forecast that the rate would hold at 9.0 percent. Confidence remains low as the labor market fails to recover; this data release is the most important event on the economic docket the coming week.Join a DailyFX analyst for live coverage of event!

 

[Jason Rogers]

U.S. Consumer Confidence Falls to Lowest Level Since April 2009

Written by Christopher Vecchio of DailyFX

THE TAKEAWAY: U.S. Consumer Confidence Misses > Economic Outlook Rapidly Deteriorating > USD Gains

An index of sentiment fell to its lowest level since April 2009, according to a report issued on Tuesday by the Conference Board. The research group’s consumer confidence index fell to 44.5 in August from 59.2 in July, marking the biggest point drop since October 2008, when the financial markets began to unravel at a quickening pace.

According to a Bloomberg News survey, economists’ had forecasted the figure to come in at 52.0; the print marks another major data release in which the forecast has missed by a significant margin, underscoring the notion that the economic climate is worse than what the markets are already pricing in.

The U.S. Dollar was stronger after the news, as were the other funding haven currencies, the Japanese Yen and the Swiss Franc, as market participants traded in higher yield, in the form of the commodity currency block, in favor of safety in the form of lower yields. In the minutes leading up to the release and approximately ten after, the USD/CAD jumped by approximately 30-pips, in line with the equity markets’ collective response by sliding sharply lower.

At the time this report was written, the USD/CAD had already pared back some of its gains, and risk-appetite was moving higher once more. Given the fundamental backdrop – unemployment above 9.0 percent, consumer confidence at multi-year lows, and a housing sector that remains mired in a period of significant contraction – and the recent dysfunctional nature of the markets, as further disappointing data releases emerge, it’s possible that risk-appetite increases on speculation that the poor data will force the Federal Reserve to inject further liquidity into the markets.

 

[Jason Rogers]

SSI: US Dollar Breakout Could be the Real Deal

Written by David Rodriguez of DailyFX

Important shifts in forex crowd sentiment warn that the US Dollar (Ticker: USDOLLAR) could continue its sudden resurgence against the Euro, British Pound, Japanese Yen, and Swiss Franc.

EURUSD –A substantial shift in FX market sentiment has left traders net-long the EURUSD for the first time since the pair traded to 1.4100 on August 4. Normally we would say that this a strong contrarian signal that the pair could continue its decline. Yet there is likewise risk that the pair could hold multi-month triangle support near current price levels, and the SSI tends to do poorly as a contrarian indicator when currencies remain stuck in broad consolidative ranges. A key question is simple: does the EURUSD have enough traction to take out significant support?

The ratio of long to short positions in the EURUSD stands at 1.04 as nearly 51% of traders are long. Long positions are 32.6% higher than yesterday and an impressive 89.8% stronger since last week. All the while, short positions are a modest 13.5% higher than yesterday yet mostly unchanged since last week. The SSI is a contrarian indicator, and the fact that crowds have turned net-long EURUSD for only the second time this month gives us a cautiously bearish trading bias.

Read Full Report

 

[Jason Rogers]

NFP Shocker Fuels Swissie Rally- Dollar Remains Well Supported

Written by Michael Boutros, DailyFX Currency Analyst

The Swiss franc is the top performer against the greenback for the third consecutive session with an advance of more than 1.8% in early North American trade. Today’s much anticipated August non-farm payrolls report shocked investors with a flat read, suggesting the US economy failed to net any new jobs last month. The data slammed risk appetite with the swissie remaining well supported below the 23.6% Fibonacci extension taken from the July 1st and August 29th at the 0.79-figure. Interim resistance holds here with the swissie likely to settle around these levels as trade thins ahead of the holiday weekend. Subsequent ceilings are eyed at 0.7950, the 0.80-handle, and the0.8075. Support rests with at the 38.2% extension just below the 0.77-figure backed by 0.7650 and the 50% extension at 0.7525.

The Canadian dollar was the weakest performer an hour into US trade, sliding more than 0.70% against the greenback. Weaker than expected jobs data continues to weigh on future growth prospects for the world’s largest economy, with its largest trading partner likely to feel the effects of the sluggish recovery. Also putting pressure on the loonie is a 3.1% decline in crude oil prices, one of Canada’s largest exports. The USDCAD pair broke above the 38.2% Fibonacci extension taken from the June 27th and August 8th crests at 0.9810 before losing running out of steam at the 0.9830 interim resistance level. The US dollar is likely to pair some of these gains as the move may be overdone here with RSI moving into overbought territory. Interim support rests at former resistance at the 38.2% extension with subsequent floors seen at the 50% extension at 0.9750 and 0.9730. A breach above 0.9830 sees topside targets at 0.9850 and the 23.6% at 0.9880.

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[Jason Rogers]

Euro Still Under Pressure Despite Supportive Intraday Developments

Written by Joel Kruger of Dailyfx.com

The detracted attention from the Eurozone on Tuesday was well appreciated after regional markets had been getting slammed on an overall deterioration within the local economy. The SNB announcement to aggressively intervene on behalf of the Franc in an effort to prevent further appreciation in the currency resulted in some unprecedented one day moves, with the Franc selling off by over 8% against many of the major currencies in a matter of minutes. However, it seems as though the storyline is now fading just a bit, with the more dominating and broader theme of Eurozone financial market stress coming back into the picture.

Relative Performance Versus the USD on Wednesday (as of 10:30GMT)

AUD +1.10%
NZD +0.64%
JPY +0.58%
CHF +0.40%
EUR +0.29%
CAD +0.24%
GBP +0.18%

EUR/USD: The market still remains confined to a broader consolidation since April, with rallies well capped above 1.4500 and pullbacks finding decent support below 1.4000. However, the contraction in volatility over the past several months warns of a near-term breakout and given the more bearish structure on the monthly chart which suggests the formation of a longer-term lower top by 1.5000, we project the breakout to be to the downside. In the interim, look for setbacks to establish below 1.4000 over the coming sessions, with any intraday rallies expected to be well capped ahead of 1.4200. Tuesday’s bearish close below the 200-Day SMA is significant as the market has not been able to achieve this feat since early 2011.

 

[Jason Rogers]

U.S. Dollar Weakness Ahead, Euro Eyes July Low

Written by David Song of Dailyx.com

DJ FXCM Dollar Index

The Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) remains 0.17% higher from the open after moving 64% of its average true range, and the reserve currency may continue to consolidate over the remainder of the week as price action breaks out of the upward trend from earlier this month. In turn, the short-term reversal from 9653 may gather pace over the next 24-hours of trading, and the index may fall back towards former resistance around 9515 to test for near-term support. However, dovish comments from Fed Chairman Ben Bernanke could exacerbate the recent weakness in the greenback, and the USD may give back the rebound from 9395 as market participants speculate the FOMC to expand monetary policy further over the coming months.

Three of the four components weakened against the greenback, led by a 0.87% decline in the Euro, and the single-currency is likely to face additional headwinds over the near-term as the central bank continues to soften its hawkish tone for monetary policy. Indeed, the recent comments from ECB President Jean-Claude Trichet suggests the Governing Council will preserve a wait-and-see approach throughout the remainder of the year, but the central bank may face increased pressures to shore up the economy as policy makers curb their outlook for growth and inflation. Given the increased reliance on the ECB, the council may have little choice but to delay its exit strategy further, and the central bank may see scope expand its nonstandard measures as the ongoing turmoil within the financial system bears down on the real economy. In turn, the recent decline in the EUR/USD looks poised to gather pace in the days ahead, and the exchange rate may threaten the rebound from 1.3836 as the fundamental outlook for Europe deterates.

 

[Jason Rogers]

Euro Breaks Critical Support; ECB Policy Shift Carries Broad Implications

Written by Joel Kruger of DailyFX.com

Most of the market reaction over the past several hours has been in response to the fallout from the European Central Bank rate decision in which President Trichet outlined a more intensified fear of the Eurozone economy and the need for the central bank to keep things on the accommodative side. One of the key take aways from Mr. Trichet and company was that inflation risks were balanced and no longer to the upside. The language clearly added weight on the Euro with the market dropping sharply in response, and paving the way for a good deal of negative sentiment into Friday. Talk of global monetary accommodation in the face of a struggling macro economy gained traction as market participants speculated of the possibility for some form of coordinated stimulus at the upcoming G7 meeting.

Relative Performance Versus the USD on Friday (as of 15:00GMT)

1. JPY -0.31%
2. GBP -0.41%
3. CAD -0.59%
4. CHF -0.93%
5. NZD -1.00%
6. AUD -1.01%
7. EUR -1.22%

Technically, today’s break back below the 1.3835 July low is significant with the market now potentially carving out a key lower top that exposes additional declines all the way back down towards the 1.2000 area over the coming weeks and months. A closer look at the longer-term Euro chart since the 2008 record highs shows the market moving in a downtrend and potentially on the verge of carving out the next major lower top. The rapid deterioration in the Eurozone supports this outlook on the fundamental front, and we contend that any attempts to offer some form of a soft landing in the region will still prove to be a tough task as the local markets are forced to battle far too many demons which include; bailouts on the peripheral, record widening bond spreads, a troubled banking sector, political turmoil, and threat of downgrade.

On the strategy front, we continue to recommend looking for opportunities to build into long US Dollar positions. The current market environment is definitively risk averse and should only continue to promote additional safe haven buying. With the Swiss Franc no longer a viable option and the Yen hardly being classified as risk free, we see the US Dollar emerging as the prime beneficiary of these flows in the currency markets. There have been those that have distorted perceptions of safe haven alternatives by shifting into higher yielding and emerging market plays, but we feel this strategy will soon prove to be quite painful as themes of instability and uncertainty eventually expose these markets for what they really are……risk correlated assets that will fall victim to liquidation on a further decline in the global economy. The idea of hiding in the Australian Dollar is one such example where the lure of yield will likely be severely offset on the reality that the deluge of global economic and financial market deterioration will soon initiate a third phase and extend from Europe into the Asian and emerging markets.

 

[Jason Rogers]

Euro Plummets to 6-month Low as Greece Default Nears

Written by Christopher Vecchio of DailyFX.com

Although market participants may have been feeling slightly more positive about the medium-term outlook of the U.S. economy after President Barack Obama’s speech on the labor market last night, any optimism was erased after developments out of Europe today. An event that has been a long time coming, it now appears that Greece will default on its debt and / or be forced to leave the Euro-zone. On such news, risk-appetite quickly evaporated, leading to a mass exodus from European banking shares and higher yielding assets.

One of the biggest losers throughout the European trading session was the Euro. After breaking below the psychologically significant 1.4000 exchange rate yesterday after the European Central Bank maintained its key interest rate at 150-basis points while simultaneously employing dovish rhetoric, the EUR/USD hit a six-month low on Friday. Trading at 1.3645 at the time this report had been written, the EUR/USD was the second weakest currency pair on the day, just behind the EUR/JPY.

The Euro was, in fact, the worst performing major currency across the board, even ahead of higher yielding currencies such as the Australian Dollar and the New Zealand Dollar, typically the two currencies that face increased selling pressure in times of risk-aversion due to their higher yields. The currency bloc was certainly not supported by the resignation of European Central Bank Executive Board member Juergen Stark, who apparently was leaving in protest of the central bank’s bond buying policy, according to sources. Although the European Central Bank said Stark was leaving for “personal reasons,” such a scenario is highly unlikely, given the state of European affairs.

Thus far, on Friday, the Dow Jones FXCM Dollar Index is significantly higher, trading at 9728.58, at the time this report was written, after opening at 9628.85. The index has traded mostly to the upside, with the high at 9731.94 and the low at 9609.17.

Key Price Levels: 15:30 GMT

 

[Jason Rogers]

Risk Appetite Gathers Pace- Kiwi Surges as Investors Chase Yields

Written by Michael Boutros of DailyFX.com

Daily Winners and Losers

The kiwi tops the performance charts early in North American trade with an advance of 1.25% against a weaker dollar. Global equities have continued to rally, boosting demand for higher yielding growth linked assets with the New Zealand dollar surging against all of its major counterparts. The NZD/USD pair broke above interim resistance at the 23.6% Fibonacci extension taken from the August 8th and September 12th troughs at 0.8260 early in the New York session. Topside resistance now stands at the 38.2% extension at 0.8350 backed by 0.8380 and the 50% extension at 0.8420. Interim support now rests at former resistance with subsequent floors seen at the 0.82-figure, 0.8160 and 0.8115.

 

[Jason Rogers]

Dollar Surges as EU Debt Crisis Reaches Critical Mass- Aussie Heavy

Written by Michael Boutros of DailyFX.com

Daily Winners and Losers

The Japanese yen is the top performer against a stronger dollar early in North American trade. The gains come on the back of a massive sell-off in global equity markets overnight as investors shed risk-assets for the relative safety of the greenback and the yen. European debt concerns continue to plague risk-sentiment after a two-day meeting of EU officials failed to calm markets as speculation that Greece will default continue to take root. The Euro fell to seven-month lows as stocks sold off, with haven flows benefitting the dollar and the yen. The USD/JPY pair broke interim support at 76.80 with subsequent floors seen at 76.65, 76.40, and the 76.4% Fibonacci extension taken from the July 8th and August 1st toughs at 76.25. Topside resistance stands at 76.80, backed by the 61.8% Fibonacci extension at the 77-figure, and 77.20. Overnight traders will be eyeing the economic calendar out of Japan with the July leading index and sales data on tap. The yen is likely to remain well supported in the interim as risk appetite remains subdued.

The Australian dollar is the worst performer against a stronger greenback an hour into US trade with the aussie sliding more than 1.6%. As tensions in Europe approach critical mass traders have continued to seek refuge in lower-yielding ‘safe’ haven assets putting the aussie back on the defensive. The AUD/USD pair tested interim support at the 50% Fibonacci extension taken from the August 1st and September 1st crests at 1.0180 early in the session. As noted in Thursday’s AUD/USD Scalp Report, a break below this level eyes targets at 1.0110, the 61.8% extension at 1.0045, and parity. Topside resistance holds at 1.0235 backed by 1.0280 and the 38.2% extension at 1.0315. The RBA minutes are released overnight with trades looking to Governor Glenn Steven’s for clues as to the central bank’s growth outlook. Credit Suisse swaps are now factoring in a 94% chance the RBA will move to cut interest rates at the next policy meeting with twelve month expectations now factoring up to 147 basis points in cuts. The Aussie is likely to remain under pressure ahead of the release as the investors continue to shed risk ahead of the highly anticipated FOMC rate decision on Wednesday. Traders will be lending a keen ear to Chairman Bernanke’s remarks as speculation for another round of quantitative easing continue to take root.

 

[Jason Rogers]

Yen Approaches Record Highs as Haven Flows Slam Risk Currencies

Written by Michael Boutros of DailyFX.com

Daily Winners and Losers

The Japanese yen is the top performing currency against a stronger dollar for the second consecutive day as a massive risk sell-off sweeps across the globe. The FOMC rate decision yesterday saw investors scurry into haven assets after the Fed cited, “significant downside risk” to the domestic economy. In an effort to flatten the yield curve and reduce longer-term rates on mortgages, small business loans, and student loans, the central bank implement the highly criticized ‘operation twist’. Bernanke and company pledged to purchase $400 billion in longer-term maturities while selling that same amount of shorter-term debt in order to maintain the Fed’s current balance sheet. However market participants focused on the statement’s gloomy outlook for future growth, fueling a massive sell-off in equity markets with European stocks down as much as 4.5% in early US trade.

Subsequently, haven currencies like the yen and the greenback have gone on the offensive with the USD/JPY pair trading near all-time lows just above the 38.2% Fibonacci extension taken from the August 4th and September 9th crests at 76.20. A break below this level eyes targets at the 76-figure and the 50% extension at 75.70. Note that as the yen continues to appreciate traders will be testing the BoJ’s resolve and intervention concerns are sure to be rekindled. Topside resistance now stands at 76.40 with subsequent ceilings eyed at 76.60 and the 23.6% extension at 76.80.

 

[Jason Rogers]

Crude Targeting a Break of August Low and Extension

Written By Jamie Saettele of DailyFX.com

Prepared by Jamie Saettele, CMT

The month + crude rally may be nearing completion. The advance can be counted in a corrective manner (wave c diagonal). One final thrust into Fibonacci resistance at 9108 or 9267 cannot be ruled out but if this count is correct then crude is at risk of a sharp reversal lower.” Crude also plunged and expectations are for a break below the August low. Objectives are the August and May lows at 7075 and 6716.

 

[Jason Rogers]

US Dollar Pullback Has Room to Continue Before Rally Resumes

Written by Ilya Spivak of DailyFX.com

THE TAKEAWAY – Technical positioning hints the US Dollar has room to continue its downward correction but the larger trend still favors the return to a longer-term advance.

US DOLLAR – Prices followed a bearish Hanging Man candlestick below resistance at 9985, the 76.4% Fibonacci extension, with a break through the 61.8% extension level at 9923. The next major layer of support stands at 9831, the intersection of the 38.2% Fib and the bottom of a rising channel set from late August. The 61.8% mark has been recast as resistance.

S&P 500 – Prices put in a Doji candlestick above 38.2% Fibonacci extension support at 1127.42 and proceeded to move higher, with the bulls now probing above the 23.6% level at 1167.03. A daily close above this juncture exposes resistance at 1227.40, with 1167.03 recast as support. For the time being however, the immediate downside barrier remains at 1127.42.

GOLD – A pronounced Hammer candlestick above support at $1624.09 – the 23.6% Fibonacci retracement level – preceded the beginnings of a corrective bounce. Buyers now see the 38.2% level at $1680.78 as near-term resistance. The 23.6% Fib continues to act as immediate support.

CRUDE OIL – Prices broke above 38.2% Fibonacci extension resistance at $80.97 yesterday, opening the door for a move to the 23.6% level at $84.61 from here. The 38.2% Fib has been recast as near-term support. Gains remain corrective whilst within the falling channel carved out from early May.

Daily Chart - Created Using FXCM Marketscope 2.0

 

[Jason Rogers]

Aussie Climbs on Improved Risk Appetite- Rally to be Short-Lived

Written by Michael Boutros of DailyFX.com

Daily Winners and Losers

The Australian dollar is the top performer against a weaker greenback in North American trade, advancing 0.82% early in the session. News that the German parliament had successfully passed a vote to expand the European Financial Stability Fund (EFSF) saw a pickup in risk as concerns of an imminent default in the region eased. Demand for higher yielding assets propped up the aussie which continues to consolidate within a triangle formation. Interim resistance stands at the upper-bound trendline with topside breach eyeing subsequent ceilings seen at the 76.4% Fibonacci extension taken from the July 28th and September 1st crests at 0.9895, 0.9930 and the weekly high at 0.9980. Support rests at the 0.9800-figure backed by 0.9750 and the 97-handle. From a technical standpoint the longer-term outlook for the aussie remains weighted to the downside with targets seen held as low as 0.9620.

 

[Jason Rogers]

Dollar Soars as Stock Sell-off Steepens- Aussie to Tests Key Support

Written by Michael Boutros of DailyFX.com

Daily Winners and Losers

The euro is the top performer against a stronger dollar in North American trade, advancing more than 0.30% early in the session. The single currency has remained rather resilient in the face of a global sell-off in risk which continues to weigh on investor sentiment. The EUR/USD pair encountered strong support at the 1.3150 level in overnight trade an looks to test the 100% Fibonacci extension taken from the September 21st and 28th crests at 1.3255. The outlook for the pair remains weighted to the downside after Greece announced it will not meet its 2011 deficit target required to obtain the next EU/IMF tranche payment. As default concerns now approach critical mass it is likely the pair will come under increasing pressure, with a break below 1.3150 eyeing interim support targets at 1.3120, the 1.31-figure and 1.3050. Topside resistance stands at the 100% Fibonacci extension at 1.3260 with subsequent ceilings eyed at the 1.3310, the 76.4% extension at 1.3360 and 1.3420. Investors will be eyeing data out of the region overnight with German and EU PMI data on tap.

 

[Jason Rogers]

US Dollar Bounces But Chart Setup Still Warns of Setbacks

Written By Ilya Spivak of DailyFX.com

THE TAKEAWAY – The US Dollar is bouncing from key technical support as risky assets run into resistance but positioning still warns of setbacks emerging over the near term.

US DOLLAR – Prices are reversing higher from support at 9979, the intersection of the 23.6% Fibonacci extension and the bottom of a rising channel set from late August. Initial resistance lines up at 10068, the 38.2% Fib, with a break above that exposes the 50% level at 10139 once more. Still, negative RSI divergence warns that bullish momentum is vulnerable, with a break below current support targeting 9831.

Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 – Prices broke above resistance at 1124.81the 38.2%Fibonacci extension, with the bulls now poised to challenge key resistance at 1165.39 marked by the intersection of the 23.6% level and a falling channel top. The 38.2% Fib has been recast as near-term support.

CRUDE OIL – Prices completed a bullish Three Inside Up candlestick pattern and rose to challenge resistance at 80.97, the intersection of the 38.2%Fibonacci extension and a falling channel top. A break higher exposes the 23.6% Fib at 84.61. Support stands at 78.03, the 50% extension level.

GOLD – Prices remain wedged locked in a range between the 14.6% and 38.2% Fibonacci retracements at 1589.14 and 1680.78 respectively. A break below immediate support exposes the September 26 low at 1532.45. Alternatively, a push higher through the range top exposes the 50% Fib at 1726.60.