Daily Forex Market Preview, 28/08/2017
The US dollar weakened into the closing session on Friday as investors quickly raised their bets on the euro. The US dollar index closed at 92.45 marking a 15-month low. The declines in the USD came surprisingly as both Yellen and Draghi failed to address the specifics of the future course of their respective monetary policies.
Friday also saw the US durable goods orders which rose 0.5% on the core while the headline durable goods orders fell 6.8%, reversing the previous month’s 6.0% increase. It was also below the forecasts of a 6.0% decline.
In the Eurozone, the German final GDP figures showed a quarterly GDP growth rate of 0.6% which was in line with estimates.
Looking ahead, the economic calendar is light today leaving traders to digest the comments from Jackson Hole Symposium. The US goods trade balance will be released alongside the wholesale inventories. The pace of economic data is, however, expected to pick up the pace as the week progresses.
EURUSD intraday analysis
EURUSD (1.1923): The EURUSD closed on Friday at 1.1923 after briefly pushing fresh highs of 1.1941. The EURUSD gapped higher on the open today before price started to push lower. The short term technicals point to a possible near-term pullback in prices. After breaching the previous resistance level at 1.1882, EURUSD could be seen falling back to this level to establish support. This scenario could potentially pave the way for further gains as the EURUSD eyes the 1.20 round number level. Below 1.1882 support, the next short-term support is at 1.1824 which is more likely to be tested.
GBPUSD intraday analysis
GBPUSD (1.2883): The British pound posted modest gains on Friday coming off Thursday’s doji close just below the support level at 1.2847. In the near term, a continuation to the upside could potentially keep the head and shoulders pattern that is evolving back into focus. The neckline support is seen at 1.2847 – 1.2800. In the short term charts, GBPUSD reversed near the resistance level at 1.2908. Only a convincing breakout above this level will put the British pound on track to test the 1.3033 resistance level. To the downside, GBPUSD will need to break past the doji’s low of 1.2774 in order to decline lower to 1.2628.
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USDJPY intraday analysis
USDJPY (109.17): The USDJPY has remained flat despite the weakness in the US dollar. Price action continues to consolidate near the 109.15 support level, and this range is likely to be maintained in the near term. The US GDP data and Friday’s payrolls and ISM manufacturing PMI could, however, give enough boost to the USDJPY in order to break out from this range. On Friday, USDJPY slipped back to 109.15 but managed to recover in the last trading session. The medium-term range of 110.72 – 109.15