Forex Update Trends and Price action: Market Update where now for US Dollar?

Forex Update Trends and Price action: Market Update where now for US Dollar?: EUR/USD Current price: 1.3542 View Live Chart for the EUR/USD The EUR/USD trades at fresh weekly highs, finally showing signs of life a...

Market Update where now for US Dollar?

EUR/USD Current price: 1.3542

View Live Chart for the EUR/USD

The EUR/USD trades at fresh weekly highs, finally showing signs of life and detaching off the 1.3500 level. Market has lost faith on the US as renewed concerns over debt ceiling and budget surged earlier today: sell the dollar is the name of the game this Friday. The EUR/USD upward momentum persists with US opening, with the pair pressuring the 1.3550 area, a few pips away from 1.3567, past week high and immediate resistance level. Short term technical readings support and upward continuation, with the pair now eyeing the 1.3610/20 area on a break above mentioned high, and in route to 1.3710 this year high.
Support levels: 1.3535 1.3500 1.3470
Resistance levels: 1.3570 1.3615 1.3660

GBP/USD Current price: 1.6104

View Live Chart for the GBP/USD

Pound recovered the 1.6100 mark against the greenback, supported by both UK data and Carney’s positive words on the local economic outlook. The hourly chart shows 20 SMA heading strongly higher below current price, while indicators lose some strength but hold in positive territory. In the 4 hours chart technical readings present a strong upward momentum, supporting a retest of the 1.6160 price zone, post FOMC high. A weekly close around these levels, should anticipate a continued advance in the pair for the upcoming week.
Support levels: 1.6060 1.6020 1.5970
Resistance levels: 1.6130 1.6160 1.6200

USD/JPY Current price: 98.30

View Live Chart for the USD/JPY

Accelerating downside and nearing the weekly low, the USD/JPY presents a strong bearish tone according to the hourly chart, with price well below moving averages and indicators heading south in negative territory. Weekly low at 98.25 is about to be challenge, and a price acceleration below should expose the daily ascendant trend line, today around 97.70 which also stands as post FED decision low. This will assit with our CAD/JPY and AUD/JPY positions now in profit by over 150 pips, so far
Support levels: 98.25 97.70 97.30
Resistance levels: 98.40 98.80 99.10

AUD/USD Current price: 0.9312 

View Live Chart for the AUD/USD

Australian dollar presents a pretty negative tone, having bounce slightly higher after testing 0.9296 daily low. The hourly chart shows price developing below a bearish 20 SMA, while indicators stand in negative territory, heading back lower. In the 4 hours chart the technical outlook is clearly bearish, which will likely help keep the upside limited today.
Support levels: 0.9300 0.9260 0.9220
Resistance levels: 0.9335 0.9370 0.9410

What now for USD Dollar and all pairs?

Analysis for September 19th, 2013

EUR/USD

Being influenced by the news, Euro formed an ascending impulse and may continue forming this wave. We think, today the price may consolidate at the current levels and renew the previous top. Later, in our opinion, the pair may return to the level of 1.3400 to test it from above and then start forming a continuation pattern.

GBP/USD

Pound completed its ascending structure, which may be considered as the third wave. We think, today the price may start forming a correction with the first target at the level of 1.5795.

USD/CHF

Being influenced by the news, Franc continued moving towards its main target at the level of 0.9100; this movement may be considered as the third wave of the current correction. We think, today the price may consolidate for a while at the current levels and then start forming another impulse to reach a new minimum and the target of this wave. Later, in our opinion, the pair may return to the level of 0.9190 to test it.

USD/JPY

The USD/USD currency pair completed a descending wave and right now is moving upwards to reach the target at 101.20. We think, today the price may form the first ascending wave with the target at the level of 99.20.

AUD/USD

Australian Dollar reached the target of its ascending structure. We think, today the price may consolidate at the current levels, renew the previous top, and then form a continuation pattern for a new descending movement.

GOLD

Gold broke the channel of the previous descending wave and continues forming an ascending impulse. We think, today the price may reach the local target at 1380. Later, in our opinion, the instrument may fall down to reach the level of 1340 and then grow up towards the target at 1390.

USD/JPY Holds above 100.00 looking to go to 103.00

Technical Analysis

EUR/USD

EUR/USD struggles with the 23.6% Fibo
“The euro was for many years before seen as a more expensive currency, but now it’s not so obvious given the prospects of tapering. Draghi promises more accommodation if necessary for years to come.”
- UralSib Financial Corp. (based on Bloomberg)

• Pair’s Outlook
  It seems that bullish momentum from the bounce form the 50% Fibo (July to August move) has worn off as at the moment the pair is struggling with the 23.6% retracement. For the time being 20 and 55-day SMAs with the help of weekly R1 were able to keep the pair supported, but it might be that bearishness given by the short term technicals will take upper hand. It becomes even more likely when we remember that 61.8% retracement awaits testing.
• Traders’ Sentiment
  Situation in the market remains largely unchanged as greenback remains second most bought (in 60% of cases) currency across the board. Bears hold majority (60%) of all open positions. It is a marginal increase since yesterday. Distribution of pending orders is exactly the same—51% against 49% with the bears holding marginal upper hand.

GBP/USD

GBP/USD aims at 6 month high
"The kind of growth we want won't simply emerge of its own volition. In fact, I see a number of dangers. One is complacency, generated by a few quarters of good economic data. There are risks, not least the housing market getting out of control. Recovery will not be meaningful until we see strong and sustained business investment."
- Britain's Business Secretary Vince Cable (based on Reuters)

• Pair’s Outlook
  Pair struggles with the 1.575 resistance area where we have 6 month and recent (relative) high. Probability of a failure here is rather high. In case the pair manages to consolidate above it, 1.588 would be a good interim target, 1.580 might have some psychological effects as well. Closure below 1.570 could easily pave the way to slip to 1.560.
• Traders’ Sentiment
  Pound remains the most sold major currency across the board. There is no surprise that bears hold overwhelming majority (73%) of open positions. They are strengthening their positions in the distribution of pending orders as well. They have posted 55% of them, that is 2% more than yesterday.

USD/JPY

USD/JPY breaches 100 JPY
“Investors are taking on more risk amid a global stock rally as concern recedes over military intervention. That’s pushing the yen downward, which is raising expectations for higher earnings at Japanese exporters.”
- SMBC Nikko Securities Inc. (based on Bloomberg)

• Pair’s Outlook
  After the prolonged struggle with the 100 JPY, pair managed to breach it. This uplifted significant portion of the downside pressure and put 101.4 as an interim target. If the pair manages to advance above it in a timely fashion, we could easily expect it to test 103 JPY in the short term as well. In case of a failure at the 2 month high, we could expect it to slip to 100 JPY. Failure here would put 99 JPY on the map.
• Traders’ Sentiment
  Bears are keeping the pressure on the bulls, who have lost additional 4% of the market and at the moment account for 58% or market participants. Majority of pending orders, however, remains in favour of the bulls suggesting they are not willing to give up that easy.

USD/CHF

USD/CHF slips below the 200-day SMA
"Although Syria tensions continue to linger in the background, risk assets performed well overnight, helped in part by Chinese trade and inflation data released over the weekend."
- Credit Agricole (based on The Economic Times)

• Pair’s Outlook
  It seems that the pair’s bullishness after the failure at the 50% Fibo (July-August move), has ended as at the moment the pair is testing 100 and 200-day SMA.s Failure here could provoke a sell off till 0.915 with in between here and then support being at 0.924. Closure above the 100 and 200-day SMAs would put 0.945 on the map once again, but it is too soon to speak if the pair would manage to breach it with ease.
• Traders’ Sentiment
  Distribution of open positions is exactly the same as yesterday-bulls hold 72% of them. Noticeable changed took place in the distribution of pending orders. Share of the ones posted by the bulls increased by 6% and at the moment is at 63% gauge.