{"id":28384,"date":"2018-09-28T11:37:12","date_gmt":"2018-09-28T06:07:12","guid":{"rendered":"http:\/\/www.icmarkets.com\/blog\/?p=28384"},"modified":"2025-11-14T22:09:44","modified_gmt":"2025-11-14T11:09:44","slug":"friday-28th-september-robust-greenback-weighs-on-major-currencies-a-close-above-95-00-on-the-horizon","status":"publish","type":"post","link":"https:\/\/www.icmarkets.com\/blog\/friday-28th-september-robust-greenback-weighs-on-major-currencies-a-close-above-95-00-on-the-horizon\/","title":{"rendered":"Friday 28th September: Robust greenback weighs on major currencies \u2013 a close above 95.00 on the horizon?"},"content":{"rendered":"

\n\tEUR\/USD<\/strong>:<\/h4>\n

From an open of 1.1736 to a close of 1.1640, the single currency concluded Thursday\u2019s sessions down 0.8%. USD bulls were firmly on the offensive in recent trade thanks to robust US data and a recovery in yields. According to the latest GDP report, the US economy expanded at its fastest pace in nearly 4 years, confirmed at an annual rate of 4.2%. US Durable goods also doubled expectations, though the increase was largely due to Boeing orders.<\/p>\n

H4 movement, as can be seen from the chart, ended the day closing within striking distance of demand plotted at 1.1609-1.1632, after a number of key tech supports were engulfed. Positioned just north of the 1.16 handle and September\u2019s opening level at 1.1595, this demand area is likely to enter the fray today. It may also be worth noting the RSI indicator is displaying a firm oversold\/divergence reading at the moment.<\/p>\n

On a wider perspective, weekly sellers spun off into a phase of selling from its resistance area drawn from 1.1717-1.1862. Further downside is possible according to this timeframe, as the next obvious support target does not enter the fight until demand penciled in at 1.1312-1.1445. Daily support at 1.1723 (now acting resistance) was obliterated in the shape of a near-full-bodied bearish candle yesterday, leaving price action free to drop down towards the 1.1509-1.1600 support area.<\/p>\n

Areas of consideration:<\/p>\n

On account of the above, weekly price suggests we may be heading for further selling, while daily movement indicates potential support may be seen off of 1.1509-1.1600. Note the top edge of this area represents the 1.16 handle on the H4 scale.<\/p>\n

Should the market observe a H4 bullish pin-bar formation that pierces the current H4 demand and taps the 1.16 handle (effectively bringing in daily buyers), a long on the close of this candle could be an option, targeting July\u2019s opening level at 1.1675.<\/p>\n

Today\u2019s data points: Spanish Flash CPI y\/y; EUR CPI Flash Estimate y\/y; US Core PCE Price Index m\/m; Chicago PMI; US Revised UoM Consumer Sentiment.<\/p>\n

\"2018-09-28<\/a><\/p>\n

\n\tGBP\/USD<\/strong>:<\/h4>\n

The GBP\/USD held its weaker tone on Thursday, giving way to USD strength. In the shape of a near-full-bodied daily bearish candle, H4 movement consumed August\u2019s opening level at 1.3117 and its 1.31 handle, potentially setting the stage for a move south towards support emerging at 1.3043.<\/p>\n

Against the backdrop of Wednesday\u2019s hawkish Fed assessment, USD momentum gathered speed following Thursday\u2019s robust US data. According to the latest GDP report, the US economy expanded at its fastest pace in nearly 4 years, confirmed at an annual rate of 4.2%. US Durable goods also doubled expectations, though the increase was largely due to Boeing orders.<\/p>\n

In terms of where we stand on the higher timeframes, weekly flow is seen hovering nearby its support level at 1.3047 after failing to sustain gains beyond weekly highs of 1.3217. The daily timeframe, however, exhibits potential to press as far south as trend line support (etched from the low 1.2661).<\/p>\n

Areas of consideration:<\/p>\n

Intraday sellers may find a retest to the underside of 1.31\/August\u2019s opening level at 1.3117 of interest this morning (pink arrows), targeting the H4 support mentioned above at 1.3043. Technically speaking, expecting price to extend beyond 1.3043 may be ambitious, due to the level congregating with weekly support highlighted above at 1.3047.<\/p>\n

Aggressive traders will likely look to enter at 1.31, with stop-loss orders tucked a couple of pips beyond August\u2019s opening level, whereas conservative traders may opt to drill down to the lower timeframes and attempt to pin down a bearish candlestick signal before pulling the trigger.<\/p>\n

Today\u2019s data points: UK Current Account and Final GDP q\/q; MPC Member Ramsden Speaks; US Core PCE Price Index m\/m; Chicago PMI; US Revised UoM Consumer Sentiment.<\/p>\n

\"2018-09-28<\/a><\/p>\n

\n\tAUD\/USD<\/strong>:<\/h4>\n

Broad-based US dollar strength weighed on the Australian dollar in recent sessions, pulling the H4 candles beyond support at 0.7222 and into striking distance of its 0.72 handle.<\/p>\n

0.72 is an interesting number this morning. Not only because its likely watched by many in the market, it also draws attention to itself due to fusing beautifully with the 2017 yearly opening level at 0.7199 seen plotted on the weekly timeframe. Also worth noting on the H4 scale is September\u2019s opening level plotted nearby at 0.7183, along with the RSI indicator seen fast approaching oversold territory.<\/p>\n

While the above is likely sufficient evidence to approve 0.72 as a platform for longs today, traders still need to take into account where we are situated on the daily timeframe, which happens to communicate a bearish tone right now. Fading a long-term channel resistance (penciled in from the high of 0.8135) in the shape of a bearish pin-bar formation on Wednesday, along with yesterday\u2019s precipitous decline, the daily chart suggests we have room to continue pressing lower until reaching support priced in at 0.7151.<\/p>\n

Areas of consideration:<\/p>\n

Although daily price emphasizes a southerly tone right now, the odds of the H4 candles responding from the 0.7183\/0.72 (green) zone today are high, in our humble view. Conservative traders may wish to wait and see if H4 price can chalk up a bullish candlestick formation before pulling trigger. The initial upside target from here falls in around 0.7222: the H4 support-turned resistance, followed by H4 supply at 0.7268-0.7251.<\/p>\n

Today\u2019s data points: US Core PCE Price Index m\/m; Chicago PMI; US Revised UoM Consumer Sentiment.<\/p>\n

\"2018-09-28<\/a><\/p>\n

\n\tUSD\/JPY:<\/strong><\/h4>\n

Across the board, the market observed a healthy USD bid enter the fray, lifting the USD\/JPY to a fresh multi-month high of 113.46. Trading within a cat\u2019s whisker of yearly highs, weekly movement is also seen making a run for supply at 115.50-113.85. Note this area boasts notable history, capping upside on a number occasions throughout 2017.<\/p>\n

A closer look at price action brings us to the daily timeframe, which, as you can see, remains trading within the walls of supply fixed at 113.91-113.09 (glued to the underside of the aforementioned weekly supply zone). In terms of H4 price action, however, traders witnessed the 113 handle and nearby resistance at 113.14 (now acting support) suffer a blow to the mid-section. This brought in a double-top resistance at 113.38, which, for the time being, is holding firm. Should the market push for higher ground today, it may be worth penciling in 113.69 (a Quasimodo resistance not visible on the screen) as the next upside target on this scale.<\/p>\n

Areas of consideration:<\/p>\n

Given we\u2019re trading within daily supply at the moment, this may be enough force to drag H4 price lower from the double-top resistance at 113.38 to support at 113.14 today. Although this may interest some intraday traders this morning, do bear in mind weekly price still shows room to advance until 113.85: the underside of supply.<\/p>\n

Until we connect with weekly supply, neither a long nor short seems attractive at the moment.<\/p>\n

Today\u2019s data points: US Core PCE Price Index m\/m; Chicago PMI; US Revised UoM Consumer Sentiment.<\/p>\n

\"2018-09-28<\/a><\/p>\n

\n\tUSD\/CAD<\/strong>:<\/h4>\n

During the course of yesterday\u2019s movement, the USD\/CAD rose to a two-week high of 1.3081 \u2013 touching gloves with September\u2019s opening level at 1.3070 \u2013 going into US hours. Unfortunately, the buyers were unable to maintain this upside presence, pulling back to August\u2019s opening level at 1.3021 into the close.<\/p>\n

Downside pressure was likely influenced by the fact daily price is seen engaging with a notable channel resistance (extended from the high 1.3386). In the event further selling takes place on this scale, keep eyeballs on support drawn from 1.2965.<\/p>\n

Areas of consideration:<\/p>\n