A broadly depressed euro challenged\nsession lows a touch north of the 1.11 handle Wednesday, ahead of today\u2019s preliminary\nEurozone PMIs and ECB President Draghi\u2019s final policy meeting and presser. The\nUS dollar index, measured by factoring in the exchange rates of six major world\ncurrencies, eked out marginal gains and drew price action to within touching\ndistance of weekly resistance at 97.72.<\/p>\n\n\n\n
Ultimately, London concluded unchanged\nwith the EUR\/USD hovering just north of 1.11. Bolstered by August\u2019s opening\nlevel at 1.1079 on the H4 timeframe, support coming in at 1.1084, a 50.0% retracement\nratio at 1.1085 and a trend line support (extended from the low 1.0879), the\n1.1079\/1.11 region forms a particularly interesting support area (grey). <\/p>\n\n\n\n
In addition to this, the market has\ndaily support located just north of the zone at 1.1110, which entered the mix\nyesterday. Although considered a reasonably minor pullback from Monday\u2019s high\nat 1.1179, the break of 1.1109 (an important swing high on the daily timeframe\n\u2013 black arrow) suggests an easing<\/em> of the primary trend may be on the\ncards. The primary trend, according to weekly movement, has been in motion\nsince topping in early 2018 at 1.2555. Adding to this downbeat tone, the unit\nis currently testing the lower limits of a resistance area at 1.1119-1.1295,\nwith room to press as far south as the 2016 yearly opening level at 1.0873.<\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n Outlook unchanged. <\/strong><\/p>\n\n\n\n With a possible trend change evident\non the daily timeframe, buyers may look to enter the market from the\n1.1079\/1.11 H4 support zone. Ultimately, the initial take-profit target from\nthis base can be set at Monday\u2019s high point 1.1179, closely followed by 1.12.\nNote 1.12 happens to align with the 61.8% Fibonacci resistance on the daily\ntimeframe at 1.1214\/the 200-day SMA (orange \u2013 1.1204) \u2013 bot considered the next\nupside targets on the daily scale. <\/p>\n\n\n\n The only downside to buying, of course, is weekly price testing its resistance area, and the overall trend. In order to try and circumvent this, traders may wish to wait and see if additional candlestick confirmation forms out of 1.1079\/1.11 before pulling the trigger. This helps identify buyer intent and provides an additional entry and risk measure to consider. <\/p>\n\n\n\n GBP\/USD:<\/strong><\/p>\n\n\n\n The\nBritish pound was left mostly unchanged against the buck Wednesday, with the\nGBP\/USD currently trading a few points south of 1.29 as a lack of clarity and\nrising odds of a general election continues to haunt markets. Tuesday witnessed\na 0.68% decline after MPs rejected UK PM\u2019s Boris Johnson\u2019s plan. MPs backed his\nWithdrawal Agreement Bill – but minutes later voted against the timetable.<\/p>\n\n\n\n With\nrespect to the technical framework, it\u2019s difficult to rule out the possibility\nof fresh upside attempts through 1.29, though having seen scope for the H4\ncandles to explore ground to at least 1.28, active sellers may make an\nappearance. Note just beyond 1.28, denoted via the grey zone, a noteworthy\ndaily support resides at 1.2769. This level houses strong historical\nsignificance and holds just north of the 200-day\nSMA (orange \u2013 1.2712) which is seen flattening from a down move.<\/p>\n\n\n\n Technical research on the weekly\ntimeframe remains trading in no man\u2019s land, with focus currently on supply at\n1.3472-1.3204 and long-term trend line resistance (etched from the high\n1.5930), as well as the 2019 yearly opening level at 1.2739 (support).<\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n From a technical perspective, particularly on the H4 and daily timeframe, sellers appear to have the upper hand. The recent break of 1.29, which may hold as resistance today, could serve as a platform to consider shorting opportunities, targeting 1.28 as the initial support target. An ideal scenario is a retest at 1.29 shaped by way of a H4 bearish candlestick formation. Not only will this help identify seller intent, it offers entry and risk levels to work with which is paramount when dealing with fixed <\/em>levels in the market. <\/p>\n\n\n\n AUD\/USD:<\/strong><\/p>\n\n\n\n Tuesday had the Australian dollar a\nshade lower vs. its US counterpart, and extended its downward slide Wednesday.\nThe recent move pressured H4 price south of August\u2019s opening level at 0.6848,\nclocking fresh weekly lows at 0.6833 and exposing the 0.68 handle as the next\nfeasible support zone. Shouldered closely together with two trend line\nsupports, both extended from the low 0.6670, a H4 support level at 0.6809, a\n50.0 retracement ratio at 0.6803 and a 38.2% Fibonacci retracement ratio at\n0.6802, this area (grey) holds plenty of reasons to consider this a buy zone.<\/p>\n\n\n\n On more of a broader perspective,\ntechnical research also has daily support position within the H4 zone (0.68\/0.6809)\nat 0.6808. This is simply an extension of the H4 support at 0.6809, though\nincludes additional data points seen clearer on the daily timeframe. <\/p>\n\n\n\n From the weekly timeframe, we can see\nthat since engulfing 0.6744 (blue dashed) in early August, the AUD\/USD has been\ncarving a consolidation zone between 0.6894\/0.6677 (grey). With the primary\ndowntrend in play since early 2018, the current consolidation may eventually<\/em>\nbreakout to the downside, despite recent buying. A decisive push beneath the\ncurrent range, likely clears the runway to as far south as 0.6359 (not visible\non the screen).<\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n With buyers\/sellers squaring off\naround August\u2019s opening level at 0.6848, alongside limited higher-timeframe\nsupporting structure, focus on the H4 scale shifts to the potential reversal\nzone highlighted above at 0.68\/0.6809 today.<\/p>\n\n\n\n Conservative traders threatened by the overall downtrend, however, might opt to wait for additional confirmation before committing funds to a long position. This could be as simple as a bullish candlestick pattern forming, or even drilling down to the lower timeframes and attempting to trade local structure, a trend line break\/retest formation, for example. <\/p>\n\n\n\n USD\/JPY:<\/strong><\/p>\n\n\n\n Demand for the US dollar increased\nWednesday, lifting the USD\/JPY to highs at 108.70 against the Japanese yen and\nthrough the upper boundary of a H4 bullish flag (108.94\/108.46). Assuming\nbuyers remain defensive, Quasimodo resistance at 108.94 is next in the firing\nrange, closely trailed by 109. <\/p>\n\n\n\n The 109 handle has been a level of\ninterest for some time, due to its mouth-watering connection with daily\nresistance. A collection of resistances are in view between 109.17\/108.99,\ncomprised of a resistance level at 109.17, the 200-day SMA (orange\/109.06 \u2013\nseen flattening) and Quasimodo resistance at 108.99. In the event further\nselling is seen, support at 106.80 is in view, set just south of the 50-day SMA\n(blue \u2013 107.35) which is currently facing north. <\/p>\n\n\n\n In terms of areas to keep an eye on\nthe weekly timeframe, Quasimodo support at 105.35 remains the next obvious\ndownside target, while to the upside, the 2019 yearly opening level falls in as\nthe next resistance at 109.68, merging closely with a 127.2% Fibonacci ext.\npoint at 109.56 (taken from the low 104.44).<\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n Traders looking to buy the breakout of\nthe H4 bullish flag face robust resistance around 109. Therefore, those who\npursue this bullish theme may want to consider adopting strict trade management\nrules. <\/p>\n\n\n\n Those eyeing 109 as a possible sell\nzone might opt to simply enter at market off the 109 base and position\nprotective stop-loss orders above 109.17. Conservative traders may elect to\nwait and see how H4 action behaves before pulling the trigger. This helps avoid\nwhipsaws through 109, which is common viewing around psychological boundaries. <\/p>\n\n\n\n As for downside targets out of 109, 108.70 appears a logical starting block, followed by the upper edge of the H4 bullish blag. <\/p>\n\n\n\n USD\/CAD:<\/strong><\/p>\n\n\n\n US EIA Weekly Crude Stocks (1.699M vs.\nExp. 2.232M [Prev. 9.281M]) reinforced WTI\u2019s advance Wednesday, settling above\n$55.50\/bbl. The rise in crude oil bolstered the Canadian dollar, therefore\nweighing on the USD\/CAD market from the 1.31 region to lows at 1.3073. <\/p>\n\n\n\n With sellers seemingly in control,\nTuesday\u2019s low at 1.3071 is under threat. Interestingly, the next downside\ntarget beyond this line is not expected to enter the fray until reaching 1.3028\n(not visible on the screen).<\/p>\n\n\n\n Recent selling also places\n1.3066\/1.3096, a notable support zone, under attack. Made up of an ABCD (black\narrows) reversal zone (yellow) between the 127.2% Fibonacci extension point at\n1.3066 and the tip of the ABCD correction at 1.3096, this area has yet to chalk\nup anything meaningful to the upside. <\/p>\n\n\n\n With reference to weekly flow, support\nis not expected to emerge until the 1.3015 July 15 low, followed by Quasimodo\nsupport stationed at 1.2887. This follows a recent bearish engulfing candle\nsited just south of the 2017 yearly opening level at 1.3434 and continued\nselling last week. The primary trend has remained north since bottoming in\nSeptember 2017 (1.2061). Currently, though, the candles appear to be in a\nsecondary downtrend, with its peak at 1.3661. <\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n On account of the above analysis,\nsellers appear to be gaining the upper hand now. A decisive break of Tuesday\u2019s\nlow at 1.3071 would help confirm this and validate weakness within the daily\nsupport zone mentioned above at 1.3066\/1.3096.<\/p>\n\n\n\n A close beneath 1.3071 on a H4 closing basis, preferably followed up with a retest in the shape of a H4 candlestick signal would, given the overall technical surroundings, be sufficient to sell, targeting 1.3028, the H4 support, as well as the 1.3015 July 15 low on the weekly timeframe. <\/p>\n\n\n\n USD\/CHF:<\/strong><\/p>\n\n\n\n In recent sessions, USD\/CHF movement\nmarginally overthrew the 0.99 handle to the upside, likely tripping buy stops\nwhile shaking hands with a trend line support-turned resistance taken from the\nlow 0.9799. Above here, H4 action appears free to press as far north as\nAugust\u2019s opening level at 0.9934 today, with a break of this level having trend\nline resistance extended from the high 1.0027 to target, followed closely by\nOctober\u2019s opening level at 0.9977.<\/p>\n\n\n\n In conjunction with H4 flow, daily\nprice crossed its 50-day SMA (blue \u2013 0.9895), which according to this timeframe\nunlocks the door to a possible move towards the 200-day SMA (orange \u2013 0.9955),\nclosely shadowed by a familiar resistance zone at 1.0010-0.9986. <\/p>\n\n\n\n Recent moves on the weekly timeframe\nhas the unit trading around the underside of supply at 1.0014-0.9892. Note this\narea was marginally engulfed early October, potentially setting the long-term\nstage to resistance at 1.0110 and Quasimodo resistance at 1.0124.<\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n What we have this morning is H4 activity sandwiched between 0.99 and a trend line support-turned resistance; daily flow suggesting higher prices and weekly action testing supply. In terms of confluence, this leaves little to hang one\u2019s technical hat on, therefore opting to remain on the sidelines for the time being may be the better option today. <\/p>\n\n\n\n Dow\nJones Industrial Average:<\/strong><\/p>\n\n\n\n US Stocks modestly firmed Wednesday\nafter investors processed a slew of earnings reports. The Dow Jones\nIndustrial Average added 45.85 points, or 0.17%; the S&P 500 also added 8.53\npoints, or 0.28% and the tech-heavy Nasdaq 100 climbed 14.86 points, or 0.19%.<\/p>\n\n\n\n Recent\nbidding, according to H4 technical structure, came about following a test of a\nsupport area coming in at 26522-26622. Further buying on this scale could lead\nto October\u2019s opening level at 26947 entering the mix\/trend line resistance\n(extended from the high 27322), and possibly resistance priced in at 27058.\nBeyond the aforesaid support zone, nonetheless, we have September\u2019s opening\nlevel residing at 26398, which happens to coincide with a\n50.0% support value and a 61.8% Fibonacci ratio at 26419. 26398 is therefore is\nprime to help facilitate a fakeout through the said support zone. <\/p>\n\n\n\n Research on the daily timeframe shows\nprice is capped between supply at 27110-26813 (blue – positioned just south of\nweekly resistance at 27335) and the 50-day SMA (blue \u2013 26600). Both the 50-day\nSMA and the 200-day SMA (orange \u2013 26153) still face north. <\/p>\n\n\n\n Areas of consideration: <\/p>\n\n\n\n The yellow zone between the H4 support\narea at 26522-26622 and September\u2019s opening level at 26398 provides an\ninteresting buy zone, in the event prices dip lower today. <\/p>\n\n\n\n The area between H4 resistance at 27058, October\u2019s opening level at 26947 and trend line resistance offers a potential reversal zone for sellers today. <\/p>\n\n\n\n XAU\/USD\n(GOLD):<\/strong><\/p>\n\n\n\n Since October 11, the yellow metal has\nbeen compressing within a symmetrical triangle formation (1497.4\/1473.8) on the\nH4 timeframe. Wednesday witnessed price action breakout north of this\nformation, retest the top edge and modestly hold ground. Breakout buyers here\nlikely have protective stop-loss orders plotted beneath the opposing limit\naround 1482.4, with an initial take-profit target set at the resistance area\ndrawn from 1519.9-1512.1, followed by September\u2019s opening level at 1526.2.<\/p>\n\n\n\n Strengthening the H4 timeframe\u2019s\nbullish theme is weekly price trading from a support area at 1487.9-1470.2.\nWeekly resistance is seen at 1536.9, whereas two layers of weekly support are\nvisible at 1392.0 and 1417.8, in the event we push for lower ground. In terms\nof the longer-term primary trend, gold has been trading northbound since the\nlater part of 2015 (1046.5).<\/p>\n\n\n\n Daily flow shows a bullish flag has\nbeen in motion since early September (1557.1\/1485.3), with room to push higher\nwithin its limits to test the its upper boundary which looks set to merge with\nthe 50-day SMA (blue \u2013 1504.9).<\/p>\n\n\n\n Areas of consideration:<\/p>\n\n\n\n Longs at current price, given overall price action and the recent breakout above the H4 symmetrical triangle, are certainly worthy of consideration this morning. Conservative traders may opt to wait and see if H4 price can engulf yesterday\u2019s high 1496.2 before pressing the buy button. Irrespective of the entry technique, the initial take-profit target, as underscored above, is set at the resistance area drawn from 1519.9-1512.1, followed by September\u2019s opening level at 1526.2.<\/p>\n\n\n\n The accuracy, completeness and\ntimeliness of the information contained on this site cannot be guaranteed. IC\nMarkets does not warranty, guarantee or make any representations, or assume any\nliability regarding financial results based on the use of the information in\nthe site. <\/p>\n\n\n\n News, views, opinions, recommendations\nand other information obtained from sources outside of www.icmarkets.com.au,\nused in this site are believed to be reliable, but we cannot guarantee their\naccuracy or completeness. All such information is subject to change at any time\nwithout notice. IC Markets assumes no responsibility for the content of any\nlinked site. <\/p>\n\n\n\n The fact that such links may exist\ndoes not indicate approval or endorsement of any material contained on any\nlinked site. IC Markets is not liable for any harm caused by the transmission,\nthrough accessing the services or information on this site, of a computer\nvirus, or other computer code or programming device that might be used to\naccess, delete, damage, disable, disrupt or otherwise impede in any manner, the\noperation of the site or of any user\u2019s software, hardware, data or property.<\/p>\n","protected":false},"excerpt":{"rendered":" The British pound was left mostly unchanged against the buck Wednesday, with the GBP\/USD currently trading a few points south of 1.29 as a lack of clarity and rising odds of a general election continues to haunt markets. Tuesday witnessed a 0.68% decline after MPs rejected UK PM\u2019s Boris Johnson\u2019s plan. <\/p>\n","protected":false},"author":1,"featured_media":81071,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[340,215,339,195],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/posts\/37168"}],"collection":[{"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/comments?post=37168"}],"version-history":[{"count":4,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/posts\/37168\/revisions"}],"predecessor-version":[{"id":81342,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/posts\/37168\/revisions\/81342"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/media\/81071"}],"wp:attachment":[{"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/media?parent=37168"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/categories?post=37168"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.icmarkets.com\/blog\/wp-json\/wp\/v2\/tags?post=37168"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"\/](\"https:\/\/i.imgur.com\/G6iTlWD.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/8mtqpA0.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/wRx6eG4.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/YSAoXzg.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/NkIENyh.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/hDPs0GB.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/lsyIANr.png\")
<\/figure>\n\n\n\n![\"\"\/](\"https:\/\/i.imgur.com\/KBQFdUP.png\")
<\/figure>\n\n\n\n