Daily Technical Analysis. Friday, November 03
The EURUSD maintained a volatile position during Friday’s Asian trading session, following an attempt to rally yesterday. Yesterday’s rally attempt was due to Economic Developments and Data on the EuroZone Economies and the US Economy, amid anticipation of US President Donald Trump’s announcement of his candidate for the leadership position at the Federal Reserve.
Germany’s Employment Change Index data came in least than expected yesterday, with a reading which showed a contraction of 11,000 jobs versus about 22,000 jobs. The final reading of the EuroZone PMI Index also showed a reduction in amplitude compared to the initial reading and expectations.
Technical reading of the EURUSD pair shows that the pair is trying to accommodate recent selling pressures. With no clear signals of change within the overall bearish trend, if the pair manages to break through 1.1670 resistance levels, that would allow the market to correct higher and possibly test the second resistance level at 1.1690. Breaching the support level at 1.1640 on the other hand, would re-invite the Bears to dominate the market.
The British Pound (GBP) attempted to rally on Friday after hitting a four-week low in yesterday’s session, following the BoE meeting, which saw Interest Rates rise for the first time in 10 years.
The Bank of England decided yesterday to raise Interest Rates by a quarter percentage point to 0.50% following a majority vote of two members.
A return of the pair’s renewed pressure will consolidate the previous bearish trend. A break below the support levels near 1.3070 will consolidate the declines and possibly result to a test at 1.3040 levels. The return of the price above the resistance level at 1.3110 would however, temporarily ease the selling pressure.
The Japanese Yen (JPY) saw weak trading during Friday’s trading session following the dominant volatility earlier this week. This comes ahead of the release of the US Jobs Report, later today and the volatility with Asian stocks.
Hong Kong’s Hang Seng Index was up 0.26% to see an addition of 74.69 points to 28,593.33.
South Korea’s Kospi Index fell 0.03 percent to 0.66 points, to 2,545.70.
The US Dollar has also been unstable due to changes in the Tax Cuts Law by the Republicans. The volatility of Asian Stocks today might be attributed to the possibility of a delay in the passing of the Tax Cuts.
Technically, despite the recent gains in the pair, prices still have to break and stabilize above the resistance levels at 114.25 and 114.40, in order to confirm the continuation of the rise. A drop below the near support at 113.70 levels would affect the recent uptrend and cause the market to proceed on a sideways movement.
Gold prices fell on Friday after rising yesterday to a two-week high, as markets highly anticipate the US Government Jobs Report.
The lack of clarity still clearly affects the market’s trading with no strong signs of a possible price break in any direction.
A breach above the top of the close price at 1282 or a break of the close price at 1270 would give more clarity to the expected movement.