The Euro traded downwards during the Asian trading session as the Dollar gained strength. European markets are however, optimistic that German political parties will reach an agreement on forming a coalition government despite lingering inter-party skirmishes.
Markets are also in high anticipation of the ECB Meeting this week, and the comments of the Bank regarding Inflation in the region, and its impact on the future of Monetary Policy in the Euro Zone.
Technical reading shows that prices are trying to catch a breath after the recent strong rally with no signs of a general upward trend change. However, a break of support levels at 1.2210 would allow prices to fall further likely testing the 1.2180 levels. On the other hand, a breach of near resistance levels at 1.2245 would cause an upward trend possibly testing the 1.2265 levels.
The royal currency fluctuated during the Asian session in a bullish range after a not-so-good performance last Friday following the UK’s recent Retail Sales data which showed a 1.5% drop.
Technical reading shows that prices are trying to catch a breath after the recent strong rally with no signs of a general upward trend change. A break of support levels at 1.3840 would allow prices to fall further and likely test 1.3800 levels. However, a breach of near resistance levels at 1.3880 would introduce an upward trend, and possibly test the 1.3900 levels.
The US Dollar rose against the Japanese Yen on Monday as the US Dollar stabilized, while market focus stays on the BoJ Meeting. The Japanese Yen opened today’s gains on the retreat of the Dollar last Friday due to the looming ‘shutdown’ of the US Government.
Technically, the return of selling pressures on the USDJPY pair’s movement would reinforce the current bearish trend. A break below the support levels at 110.65 will consolidate the declines and likely test 110.20 levels. A price reversal above the resistance level at 110.95 would however, ease selling pressure temporarily.
Technical reading shows that the USDCHF pair is trying to absorb the recent selling pressures that the pair is facing with no clear signals to reverse the overall bearish trend. If the pair manages to breach 0.9630 resistance levels, the market may correct higher and possibly test the second resistance level at 0.9660, while a breach of the support level at 0.9600 would re-introduce a downward trend.
Gold opened the week higher with support from market concerns after the US Government ’Shutdown’ on Friday.
Gold prices however, edged lower to cover the rising price gap at the opening of trading today, as the US Dollar stabilized during the Asian session due to oversell. Markets this week will focus on the Congressional Vote on US Federal Government funding later in the day, as well as the BoJ and ECB Meetings, as well as the North American Free Trade Organization (NAFTA) talks.
Technically, on the four-hour period, the price index of Gold moves within the symmetrical triangle, with the absence of any strong signs of a possible price break in any direction. A breach above the top of the price at 1337 or a break of the price at 1325 would give more clarity to the expected movement which would be in the same direction as the break.