Subscribe to RSS

GBP USD Technical Analysis: Eyes falling channel support

GBPUSD

The GBP/USD pair fell to a low of 1.5025 on Friday after the US non-farm payrolls report blew past expectations to print at 271K, pushing the unemployment rate dropped to 5.0%. The CME Fed fund futures now show the December rate hike probability at 69.8%. The 2-yr treasury yield, which mimics rate hike bets, rose to its highest since 2010. The cable witnessed a moderate technical recovery in Asia and is approaching 1.5087 (61.8% of Apr-Jun rally).

Fresh weakness in European session

GBPUSD

The rate hike bets spiked across the board following the stellar non-farm payrolls report. What is worth noting is the 32.5% probability of a move in the fed funds rate to 0.75% at March 16 Fed meeting.

The demand for the US dollar could spike once again in the European session as the data calendar is empty and in such cases the markets are more likely to extend the post-NFP movies; in this case it is the US dollar rally. The spot could begin its journey back to 1.5024 (falling channel support). Weakness in the European equities (due to increased possibility of a Fed rate hike) could add to bearish pressure on Sterling and other risk assets.

Technicals – Daily RSI still not oversold

Sterling’s sharp fall pushed the RSI on the hourly and 4-hour chart to oversold territory, thereby opening doors for a correction seen in Asia. However, gains could be capped around 1.5087 (61.8% of Apr-Jun rally) as the daily RSI has still not hit the oversold region. Hence, a drop to 1.5025 (falling channel support) appears possible today. A daily close below 1.5025 would reinforce bears. In case, the pair breaks above 1.5087 could open doors for 1.5163 (Sep 4 low). However, reversals from the data driven downtrend are usually seen after the RSI divergence on the 4-hour or daily charts and that is yet to happen.

EUR/USD Analysis: Could find support in weak equities

EURUSD

The EUR/USD pair fell like a rock to a low of 1.0705 levels on Friday after the US non-farm payrolls pretty much cemented the December Fed rate hike bets. The data further highlighted the divergent monetary policy path adopted by the Fed and the ECB. At the moment, the currency pair is trading around 1.0770.

Fed rate hike bets could hurt risk assets

As said earlier, increased probability of a Fed rate hike is bearish for the EUR, however, a possible risk aversion in the equities could offer support to the shared currency. The equities across Europe and in the US could witness correction as Fed prepares for a rate hike in December. Consequently, the EUR’s funding currency status could come-in to play, helping it regain composure; especially against Sterling and commodity dollars – AUD, NZD, CAD.

German trade balance figures could rattle markets as well, in case the exports drop again highlighting the economy’s vulnerability to the slowdown in China. Again a weak German export data could rattle equity markets and lead to EUR strength.

Technicals – Gains capped around 1.0819

Euro’s weekly close below 1.0758 (76.4% of Mar to Aug) has opened doors for a drop to 1.05 levels. But, the oversold RSI on the hourly and 4-hour chart could trigger a technical correction in the pair. The immediate gains appear capped around 1.0819 (May 27 low). On the downside, 1.0713 (Mar 31 low) could offer support. A failure to take out 1.0819 could be followed by a break below 1.0713 and a drop to 1.0660 (Apr 21 low).

0 commentsback to post

Add your comment

Nickname:
E-mail:
Website:
Comment:

Other articlesgo to homepage

Get 250% Bonus Promotion for First Deposit – Insta Forex

Get 250% Bonus Promotion for First Deposit – Insta Forex(0)

250% Deposit Bonus to All new trading account, who had not had accounts with InstaForex before. The bonus can be deposited to Standard USD accounts, There are few steps in getting the biggest bonus of 250%! Link:  Get 250% Bonus for First Deposit Link:  $5000 Forex No Deposit Free Bonus Link:  $5000 Forex No Deposit

30% Reduction Spreads and 30% Deposit Bonus – AvaTrade

30% Reduction Spreads and 30% Deposit Bonus – AvaTrade(0)

We have always offered excellent bonuses promo and high leverage, Enjoy a 30% Special reduction on spreads and 30% Special Welcome bonus on your deposit! Link:  100% Bonus to Your First Deposit Link:  30% Sign-up Bonus on your Deposit Link:  30% Enjoy Reduction on Spreads Available to: All new account Ending Date: 31 December 2018

30 USD Free Account Verification Forex Bonus – Xtrade

30 USD Free Account Verification Forex Bonus – Xtrade(0)

$30 Free Account Verification Forex Bonus and up to $6000 First Deposit Bonus Promotions and $25 Free Cash Bonus No deposit required forex bonus to all new live trading account. Link:  $25 Forex No Deposit Bonus Link:  $30 Free Account Verification Bonus Link:  Up to $6000 First Deposit Bonus Bonus Ending Date: 31 December 2019

Get 100% Bonus Doubles your Deposit – FBS Broker

Get 100% Bonus Doubles your Deposit – FBS Broker(0)

Get 100% Forex Bonus Doubles your Deposit FBS Broker has prepared something really special for you. Activate 100% Forex Deposit Bonus and make your trading x2 more efficient Link:  $123 Free Special Bonus Promotion Link:  100% Deposit Bonus Promotion Link:  $88.8 Lucky No Deposit Required Bonus (for Malaysian traders) Available to: All new traders Ending

50% Bonus of Every Deposit – Fort Financial Services

50% Bonus of Every Deposit – Fort Financial Services(0)

Up to 50% Bonus of Every Deposit to All New and Existing Traders. You Deposited $1000 on your account, chose a 50% bonus and got 500 extra dollars to the initial deposit amount. Link: Up to 50% Bonus of Every Deposit Link: $5 Forex No Deposit Welcome Bonus Link: 15% Support Margin Bonus Link:  Profit

Get a $50 Free Bonus Start Trading Bitcoin – UFX

Get a $50 Free Bonus Start Trading Bitcoin – UFX(0)

Get a $50 Free Bonus Start Trading Bitcoin with UFX. Forex Trading Bitcoin with UFX is simple and gives you the opportunity to increase your return whether BTC prices RISE or FALL Link:  $50 No Deposit Bonus Promotion Link:  $50 Free No Deposit Bitcoin Bonus Link:  Halloween Trick or Trade Competition Link:  100% Real Money

$3500 Free No Deposit Bonus in a Minute – Insta Forex

$3500 Free No Deposit Bonus in a Minute – Insta Forex(0)

Get $3500 Free No Deposit Bonus in a Minute from InstaForex no need to risk your own money if you have already got funds to earn more money. The $3500 Free No Deposit Bonus in a Minute from InstaForex is an exciting opportunity to start Forex live trading. Link:  $500 Forex No Deposit Free Bonus

Forex Circuits Live Trading Contest 2017 – Forex Time

Forex Circuits Live Trading Contest 2017 – Forex Time(0)

ForexTime latest Live Contest Win cash prizes from a $400,000 total prize pool. FX Circuits rewarding clients with real, withdrawable from a $400000 total prize pool.* Link:  FX Circuits Live Trading Contest Link:  Demo Forex Trading Contest Link:  Loyalty Cashback Promotions Link:  200% Withdraw able Cashback Rebates Available to:   New Clients only Contest Offer: ForexTime

$200 Forex Free No Deposit Pushup Bonus – FreshForex

$200 Forex Free No Deposit Pushup Bonus – FreshForex(0)

FreshForex finally launches long-awaited $200 Forex Free No Deposit Pushup Bonus Broker. With FreshForex new bonus every new client registered with us through special link within promotion period gets $200 to the trading account. Link:  $200 No Deposit Pushup Free Bonus Ending Date: 16 September 2018 Bonus Offer: $200 No Deposit Welcome Pushup Bonus for

$30 No Deposit Forex Welcome Bonus Campaign – Tickmill

$30 No Deposit Forex Welcome Bonus Campaign – Tickmill(0)

$30 No Deposit Forex Welcome Bonus Campaign to All new traders. $30 Free Forex Welcome Account is available to all new clients who expressed a wish for it during the registration process. Link:  Weekly Demo Race Trading Contest Link:  $30 Free Welcome Bonus Campaign Link:  Forex Monthly Live Trading Contest Available to: All new traders

read more

Forex Featured Broker

Contacts and information

ForexDepositNews.com Forex Deposit Bonus, Forex No Deposit Bonus, Forex Live Contest, Forex Demo Contest, Free Forex Bonus Forex Brokers Review and Other All Forex promotions.

ForexDepositNews.com

Social networks

Most popular categories