Daily Technical Analysis. Thursday, October 19
The Euro saw a rise during Thursday’s session before losing a large part of its gains as volatility sustained, with growing expectations of a US Interest Rate Hike before the end of the year.
Technical reading continues to show that prices are still moving within the framework of a positive correction to the general bearish trend. Resistance levels at 1.1805 and 1.1815 are still considered to be the most important short-term levels. These levels are likely to encourage the Bears, whilst any short-term trend reversal will negatively impact price action.
The GBPUSD pair bounced back in Asian trading for today’s session after consolidating well above the support of the ascending channel, same channel which it attempted to break yesterday.
Technical reading shows that the pair is trying to absorb the recent selling pressures that the pair is facing. With no clear reversal signals on the overall bearish trend, the pair has managed to break through the 1.3230 resistance levels, which would allow the market to correct higher. Breaking the support level at 1.3195 would call for the Bears to take over.
The US Dollar rose against the Japanese Yen on Thursday, as demand for the Yen fell despite impressive Data. This is due to the fact that the yield on US Government Bonds rose sharply pushing Investors to the Dollar at the expense of the Japanese currency.
Technically, technical reading shows that prices are trying to catch a breath after the recent strong rally. With no signs of a general bullish trend change, a break with the support levels at 112.80 would allow prices to retreat further and may test 112.60 levels. At the same time, a breach of near resistance levels at 113.05 would invite the Bulls to enter the market and possibly cause the safe haven pair to test the 113.20 levels.
Technical reading shows that prices for the USDCHF pair are trying to consolidate after the recent strong rally, with no signs of a general bullish trend change. Breaking support levels at 0.9795 would allow prices to fall further and may test 0.9775 levels.
At the same time a breach of near resistance levels at 0.9808 would invite buyers to enter the market and possibly test the 0.9835 levels. According to the pair’s daily chart we see that it is forming a double top pattern.
Gold prices continued to fall on Thursday for the fourth consecutive day, approaching a two-week low, as Dollar levels stabilized and Asian Stocks rebounded to a 10-year high.
A rebound in the price action will reinforce the previous bearish trend. A break below the near-1277 support levels will consolidate the pair and open the door to test the 1270 levels. Only a return to above the resistance level at 1282 would temporarily ease selling pressure.