IKOFX Daily Market Analysis

[team.ikofx]

AUDJPY: Break Of 95.50 To Ignite More Losses In Short Term

The Australian dollar seems to be struggling against the Japanese yen to hold the ground, as there is an important resistance around the 95.80 level, which is acting as a barrier for the pair. There were a couple of releases scheduled during the Asian session, including the AIG Performance of Services Index and Australia’s trade balance data. Both the event’s outcome was in favour of the Australian dollar, as the AIG Performance of Services Index jumped from 47.6 to 49.3, and trade balance data came better than expected with a reading of -1683M. However, the Australian dollar buyers were not encouraged by the outcome.

As mentioned, there is a critical resistance area around the 95.80 level. A contracting triangle resistance trend line on the hourly chart and the 200 moving average sits around the mentioned level, which is acting as a barrier for the pair. Moreover, the 50% fib retracement level of the last leg lower from the 96.12 high to 95.29 low is also around the same levels. So, there are more than enough reasons for the Aussie sellers to take the pair lower. The AUDJPY pair is currently trading around the triangle support trend line. There is a chance that the pair might bounce one more time to retest the 95.70-80 resistance zone, and if it fails again to break higher, then a move below the triangle support area might be on the cards.

Alternatively, if the pair surges above the 95.80 level, then there is a high probability that the pair might challenge the 96.12 high again moving ahead. The hourly RSI has just breached the 50 mark, which can be considered as a divergence sign for a move lower.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

EURUSD: Selling Rallies Is Still A Good Idea In Short Term

The Euro suffered heavy losses yesterday post impressive economic data in the US. The US ISM non-manufacturing PMI was released yesterday, which registered a reading of 58.7, beating the expectation of 56.3. This encouraged the US dollar buyers, as the pairs like EURUSD and AUDUSD moved lower. The EURUSD pair trimmed all recent gains, and created a new low below the 1.3360 support area. The pair has broken an important support area, which means it might act as a resistance in the short term. So, selling rallies look like a good option in the short term.

There was an important bullish trend line formed on the hourly chart for the pair, which was breached by the Euro sellers yesterday. The pair also broke the previous low to trade around the 1.3358 level. The RSI is around the extreme levels, which means there is a chance of a short-term retracement, but it can only be seen as a part of a correction. If the pair moves a bit higher from the current levels and moves closer to the broken trend line, then it might face selling pressure around the 1.3390-95 levels. Only a break and close above the 100 hourly moving average can put the pair back in the bullish zone.

Alternatively, if the pair continues trading lower, then it would be interesting to see whether the Euro buyers can manage to hold the last low or not. A break below the 1.3355 level might call for a move towards the 1.3320 support area.

Overall, as long as the pair is below the 1.3400 level more losses cannot be denied moving ahead towards the 1.3300 area.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

AUDNZD Down As Aussie Jobs Report Disappoints

The Australian dollar is trading lower across the board, as there was a major economic data released about an hour ago. The Australia’s employment report was published by the Australian Bureau of Statistics. The outcome was very disappointing, as the report mentioned that the employment change stood at -300, which is horrible compared to the +12K expected. Moreover, the unemployment rate ticked to 6.4% from 6.0%. So, overall the outcome was very disappointing, and weighed on the Australian dollar against most major currencies, including the New Zealand dollar. The AUDNZD pair traded sharply lower after the release.

There is an important bullish trend line formed on the hourly chart for the pair, which could possibly act as a support for the pair. The pair recently climbed higher, but failed to break the all-important 1.1050 resistance area. Currently, the pair has broken the 200 hourly moving average, and moving closer to the 61.8% fib retracement level of the last leg higher from the 1.0926 low to 1.1052 high. The mentioned fib level is just above the 100 hourly moving average. So, buyers might appear around the 1.0975 level, but considering the economic release it is very likely that the pair might continue trading lower and challenge the highlighted bullish trend line.

On the upside, the broken 200 moving average might act as a resistance in the short term and could encourage the Aussie sellers to take the AUDNZD pair lower. The RSI is around the extreme level, but the momentum is mostly in favour of sellers.

Overall, any major rallies can be seen as a selling opportunity until there is any disappointing news release from the New Zealand.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

USDCAD Looks Set For A Move Towards Last High

The US dollar is trading higher against most major currencies, including the Canadian dollar. The US initial jobless claims figure, which fell below the 290K mark ignited a rally in the US dollar. However, the Canadian Ivey PMI was also published during the NY session yesterday, which came in at 54.1, beating the expectation of 53.0. So, the outcome was on the positive side of the Canadian dollar. It gained traction for some time, but the USDCAD pair found buyers around an important support area, which took the pair higher again.

There is an important bullish trend line formed on the hourly chart for the pair, which acted as a support yesterday. The pair has now breached the 100 hourly simple moving average, and trading around the 50% fib retracement level of the last drop from the 1.0985 high to 1.0931 low. So, if the pair manages to settle above the 50% fib level and the 61.8% fib level, then a move towards the last swing high of 1.0985 is very likely. The hourly RSI has breached the 50 mark, which adds value to the bullish view in the short term.

However, a failure to break the 61.8% fib cannot be denied. If it fails to break it and moves lower again, then a test of the highlighted bullish trend line might be on the cards. The pair needs to break the trend line to gain momentum for the downside.

Overall, dips can be considered as an opportunity for buying, and as long as the pair is trading above the 100 hourly moving average more upside is possible.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

USDJPY Testing A Short Term Pivot Area

The US dollar after trading higher towards the 103.00 level against the Japanese yen moved lower back below the 102.00 support area. It looks like that the pair is currently retracing some of the recent losses and tested a major pivot around the 102.20 level. If the US dollar buyers manage to break the mentioned resistance area, then a move towards the 200 hourly moving average is likely in the short term. Let us analyse the charts and try to find out what’s the best possible scenario in the short term for the USDJPY pair.

There is a critical bearish trend line formed on the hourly chart for the pair, which acted as a resistance on several occasions. The USDJPY pair recently tested the mentioned trend line, but failed to break it. The most important point is that the same trend line also coincides with the 50% fib retracement level of the last drop from the 102.92 high to 101.51 low. So, the US dollar buyers might face a tough time around the 102.10-20 levels. Moreover, the 100 hourly moving average is also sitting around the 102.27 level at present, which means there are several hurdles for the pair on the way up.

On the other hand, if the pair fails to break the trend line, then a move back towards the 101.80 support area is likely. Any further losses might take the pair back towards the last low of 101.50. The hourly RSI is above the 50 mark, which can be seen on the positive side.

Overall, if the pair breaks higher and successfully closes above the mentioned resistance area, then one can consider entering a low-risk long position with a small stop.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

EURUSD Preparing For One More Leg Lower Ahead Of German ZEW Survey

The Euro was seen trading higher during this past week against the US dollar, but it looks like that turned out to be a false break, as the EURUSD pair is again trading lower. There is an important risk event lined up later during the London session, which might cause a lot of swing moves in the EURUSD pair. The German ZEW economic sentiment and current conditions data will be published. The Forex market is expecting a decline this time around, and if that happens the Euro might fall sharply later during the upcoming session.

There was a critical bearish trend line formed on the hourly chart for EURUSD pair, which was breached during this past week. However, the pair again fell lower yesterday, and traded below the trend line, which can be considered as a false break. Currently, the pair is trading around the 61.8% fib retracement level of the last move higher from the 1.3333 low to 1.3432 high. The negative thing to note from the charts is that the pair is trading below the 100 and 200 hourly moving averages, which might encourage the Euro sellers in the short term. Even the hourly RSI has dipped below the 50 mark, which could ignite more losses in the pair.

So, if the pair trades a bit higher from the current levels, and closer to the 200 hourly moving average, then it might present a nice selling opportunity moving ahead.

Overall, as long as the pair is trading below the 200 moving average more losses cannot be denied, but we need to be very careful around the important news release during the London session.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

Selling Rallies Preferred In NZDUSD

The New Zealand dollar continues to struggle against all other major currencies, including the US dollar, as the market sentiment remains in the favour of sellers. The NZDUSD pair recently climbed higher after creating a new low around the 0.8405 level. However, it again failed to gain traction, and that is the reason why it is moving lower one more time. There was no major economic release scheduled in the New Zealand, so the pair was mostly driven by the US dollar sentiment. Let us see how the pair can move in the coming sessions.

There is an important bearish trend line formed on the hourly chart for the NZDUSD pair, which acted as a barrier numerous times. The pair recently climbed towards the 38.2% fib retracement level of the last drop from the 0.8489 high to 0.8408 low, but it failed to break the same and turned lower again. It is possible that the pair might attempt one more time to break higher and fail again. The previous low of 0.8408 holds the key in the short term, as if sellers manage to break the same, then a new low below the 0.8400 level might be possible in the short term. The 0.8380 level can be seen as the next level of interest in the pair.

Alternatively, if the pair moves higher and breaks the 38.2% fib level, then the chance of a move above the highlighted trend line might increase. If that happens the pair might trade above the 0.8500 level moving ahead.

Overall, selling rallies might be a good option unless the pair breaks above the trend line and resistance area.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

GBPUSD Collapses Post Dovish BOE Inflation Report

The British pound was slammed yesterday after the BOE inflation report, which was released during the London session. The BOE highlighted the fact that it is not the correct time to discuss the rate hike, as there are still a lot of concerns regarding the wage growth. The British pound moved lower against most other major currencies. The pair which was most affected was the GBPUSD, which moved below the 1.6700 support level, dropping more than 120 pips in a short time. The pair has not stopped since then, as it continues to move lower.

There was an important bullish trend line formed on the daily chart for the GBPUSD pair, which was breached earlier. The pair has even breached the 100-day moving average, which is a bearish sign in the short term. The pair is currently trading around the 38.2% fib retracement level of the last leg higher from the 1.5853 low to 1.7192 high, which is also just above the 200-day moving average. There is a chance that the pair might bounce from the current or a bit lower levels, but in that situation it is very likely to find sellers around the 1.6760-80 resistance area. Any further gains could take the pair towards the 100-day moving average.

It is also possible that the pair might retrace slightly from the current levels as the daily RSI is around extreme levels, and then continue trading lower. A break below the 200-day moving average could take the pair closer to the 50% fib retracement level.

Overall, selling rallies looks like a nice deal in the short term as the sentiment is still in the favour of the British pound sellers.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

USDCHF – More Upside Looks Difficult As Bulls Struggle

The US dollar traded a touch lower against the Swiss franc yesterday after the US initial jobless claims data was published. The market was expecting a reading of 295K, but the outcome was somewhat disappointing, as the US initial jobless claims rose to 311K. The USDCHF pair fell towards the 0.9030 level, but managed to find buyers around the mentioned level. The pair is again trading higher. It looks like it is consolidating in a range of 40-50 pips for some time, and waiting for the right catalyst for a break higher or lower.

There is an important bearish trend line formed on the daily chart for the USDCHF pair, which is acting as a resistance for the pair on the upside. The mentioned trend line also coincides with the 76.4% fib retracement level of the last drop from the 0.92490 high to 0.8701 low. So, if the pair moves closer to the 0.9120 level, then it might find sellers again. Only a close above the trend line resistance area might call for more gains in the pair. There is a divergence on the daily chart for the USDCHF pair, which might result in a down-move in the pair moving ahead.

On the downside, initial support can be seen around the 0.9030 level, which holds a lot of importance in the short term. The pair has bounced on a number of occasions from the stated level, and if it breaks the same and settles below, then it might ignite a sharp move lower in the pair may be towards the 0.8950 level.

Overall, selling pressure remains intact on the pair as long as it is trading below the highlighted bearish trend line.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

USDCAD – More Losses Look Feasible Moving Ahead

The Canadian dollar traded a bit higher against the US dollar during this last Friday after the Canadian employment and manufacturing data. The outcome was on the positive side, as the employment change figure came better than expected with a reading of 41.7K, beating the expectations of 20.0K. The manufacturing sales increased by 0.6%, which was 0.1% more than the market expected. Moreover, the Canadian unemployment rate remained at 7% as expected. The USDCAD pair traded as low as 1.0860, then traded higher again.

There is an important bearish trend line formed on the hourly chart for the USDCAD pair, which acted as a hurdle for the pair on the last Friday. The mentioned trend line also coincides with the 100 hourly moving average, which increases the importance of the trend line in the short term. So, if the pair moves a bit higher from the current levels, then it might find sellers around the 1.0910 level. A break above the mentioned level looks difficult as of now considering the recent market sentiment. On the upside, the 200 hourly moving average is also a barrier for the USDCAD pair.

On the downside, initial support can be seen around the last low of 1.0860, followed by the last swing support area at 1.0820. The hourly RSI is below the 50 mark, which increases the risk of a break lower in the short term. Let us see how the pair reacts around the last low if it reaches there.

Overall, it looks like the pair might continue trading lower but if it climbs a bit higher from here then it can be seen as a selling opportunity.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

AUDUSD – Aussie Likely To Test 0.9350 Resistance Again

The Australian dollar was seen trading higher against the US dollar recently. The Reserve bank of Australian released the monetary policy meeting minutes earlier during the Asian session. There was nothing new to highlight from the minutes. The Australian dollar is trading higher post release and broke the 0.9320 resistance area. Moreover, the Australian inflation expectation was also published, which had a positive impact on the Australian dollar. The most important point to note was that the central bank expects the Inflation pressures to ease, and is within the target. This also helped the AUDUSD to trade higher.

There is an important bearish trend line formed on the 4 hour chart for the AUDUSD pair. The pair is currently trading higher and heading towards the mentioned trend line, which also coincides with a critical confluence area. The 200 moving average on the 4 hour chart and the 50% fib retracement level of the last drop from the 0.9470 high to 0.9240 low sits around the 0.9350-55 levels. So, it is possible that the Aussie buyers might find it hard to break the mentioned resistance levels. If they fail to do so, then the pair could fall back towards the 0.9280 support area in the short term. However, it might find the 100 moving average on the downside, which could act as a pivot zone for the pair.

Alternatively, if the pair breaks the trend line and confluence area, then it might trade towards the 61.8% fib level, followed by a test of the previous high of 0.9470.

Overall, buying dips remain a good option in the short term until the market sentiment changes in the favour of sellers.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

EURGBP – 0.8050 Might Act As Pivot Zone Moving Ahead

The British pound traded lower yesterday after the UK consumer price index data was released. The market was expecting the UK CPI to be around the 1.8% (year-over-year) change, but the outcome was a disappointing one, as the UK CPI increased only by 1.6%. This caused a strong bearish pressure on the British pound. As a result, it not only traded lower against the US dollar, but traded lower against the Euro as well. The EURGBP pair again traded above the 0.8000 resistance area, which can be seen as a positive sign in the short term. However, there is a monster resistance around the 0.8050 level, which might act as a barrier for the pair.

There is an important bearish trend line formed on the daily chart for the EURGBP pair. The most important thing to note from the charts is that the mentioned trend line is coinciding with the 50% fib retracement level of the last drop from the 0.8149 high to 0.7874 low. So, if the pair moves higher from the current levels, and trades closer to the highlighted trend line and resistance area, then there is a chance that the pair might fail to break the 0.8050 level. In that situation, the pair is likely to move back lower again.

Fundamentally, the economic data also do not support gains in the Euro, so there is a chance that the pair might not even attempt to test the mentioned resistance area. On the downside, initial support can be seen around the 0.7960 level, which might act as a strong barrier for the Euro sellers moving ahead.

Overall, selling rallies remain a good option as long as the pair is trading below the 0.8050 level.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

GBPUSD Extends The Fall; What’s Next?

The British pound was hammered yesterday against the US dollar, as the FOMC meeting minutes encouraged the US dollar buyers. The FOMC meeting minutes pointed out that some of the fed members think that a rate hike is possible ahead of time. This was seen on the positive side, and the result was bullishness for the US dollar. The US dollar was seen trading higher against almost all major currencies, including the British pound. The GBPUSD pair is following a nice bearish momentum from the last several days. However, we need to be careful as the pair is extremely oversold, and there is a possibility of a correction in the short term.

There is a monster sliding channel forming on the 4 hour chart for the pair. This particular channel has acted as a support and resistance on a number of occasions. Currently, the pair is testing the channel support area, which is around the 1.6575 level. It is possible that the pair might bounce from the current levels towards the channel resistance area and fail again to break above the same. In that situation, the pair might dive to create a new low in the short term. Only a break above the channel resistance zone and the 38.2% fib retracement level of the last slide might encourage the bulls moving ahead.

On the downside, initial support can be seen around the 1.6560 level, followed by the all-important 1.6520 support area. It would be interesting to see how the pair reacts around the mentioned levels if it reaches there.

Overall, selling rallies remain a good option as long as the pair is trading inside the channel. However, we need not to get aggressive as the pair might bounce anytime.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

EURUSD – 1.3285 Is Pivot Zone In Short Term

The Euro fell lower against the US dollar recently and traded below the 1.3250 level where buyers emerged. The EURUSD pair has somehow managed to trade a bit higher from the mentioned level. One of the main reasons for sustaining more losses was the German manufacturing and services PMI data. The market was expecting a sharp contraction, but the result was not that bad, which helped the Euro to gain some ground yesterday. However, there are several resistances on the way up for the pair, which might trouble the Euro buyers moving ahead.

There is a critical bearish trend line formed on the hourly chart for the EURUSD pair, which is currently acting as a hurdle for the pair. Moreover, the 38.2% fib retracement level of the last drop from the 1.3356 high to 1.3242 level also sits around just around the mentioned trend line. So, it is likely that the Euro buyers might struggle to break the 1.3285-90 resistance area. If they manage to break it, then a move towards the 100 hourly moving average is possible in the short term, which is just above the 61.8% fib level. Any further gains might take the pair towards the 1.3350 resistance area.

If the Euro buyers fail to take the pair higher, then on the downside initial support can be seen around the 1.3260 level. A break above the mentioned level might expose a retest of last low of 1.3242.

Overall, buying dips is a good option until the pair is trading above the monthly low. Today the Fed Yellen will be delivering a speech, which might cause a lot of moves in the EURUSD pair.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

Buying Dips Favoured In USDCAD

The Canadian dollar traded a touch higher after the Canadian CPI was released during this last Friday. The Canadian CPI came in at 2.1%, which is down from 2.4%. However, the downside in the USDCAD pair looks limited, and every move lower might present a nice buying opportunity. The pair has opened with a gap higher this week, and there is a chance that it might drop a bit from the current levels to fill the gap and find buyers again. There are tons of support on the way down for the pair, which might hold the downside in the pair in the short term.

There is a critical bullish trend line formed on the hourly chart for the USDCAD pair, which acted as a support time and again for the pair. One most important thing to note here is that the same trend line is now coinciding with the 100 hourly moving average, which increase the importance of the trend line. So, if the pair drops from the current levels to fill the gap, then there is a chance that it might find buyers around the 1.0940 level. The hourly RSI is also above the 50 mark, which is a positive sign. On the upside, initial resistance can be seen around the last swing high of 1.0980, followed by the 1.1000 level.

If the US dollar buyers fail to defend the highlighted trend line, then a break below might take the pair towards the 200 hourly moving average, which also coincides with the 50% fib level of the last move higher from the 1.0860 low to 1.0986 high.

Overall, buying dips is a good option until the pair is trading above the highlighted trend line.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

AUDUSD – Selling Rallies Preferred Moving Ahead

The US dollar outperformed almost all major currencies during this past week and opened higher this week. However, the Australian dollar managed to sustain some ground compared to other major currencies. This resiliency does not mean that there is no chance of the pair trading lower in the short term. There are several resistances around the 0.9300 level, which might continue to act as a hurdle for the Australian dollar buyers.

There was a major bearish trend line on the hourly chart for the AUDUSD pair. Currently, the pair is struggling to break the 100 hourly moving average, which is around the 0.9298 level. The most important thing to note here is that the 100 moving average is also coinciding with the 50% fib retracement level of the last drop from the 0.9322 high to the 0.9271 low. So, there is a chance that the pair might start trading lower from the current levels. However, if it manages to trade higher, then the next resistance can be seen around the 200 hourly moving average, which is coinciding with the 76.4% fib level. The most important resistance is around the highlighted bearish trend line.

On the downside, initial support can be seen around the recent low of 0.9271, followed by the last swing low of 0.9237. Any further downside momentum should see buyers around the 0.9200 support area. The hourly RSI is struggling to break the 50 level, which is a negative sign considering the recent market sentiment.

Overall, selling rallies remains a good option until the pair is trading below the highlighted bearish trend line.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

Euro Might Continue Lower Against British Pound

vThe Euro after trading as high as 0.8036 level traded lower. The economic data in the Euro zone and the UK were on the disappointing side, but it is the Euro which has declined heavily in the recent days. The EURGBP pair broke an important support around the 0.7970 this week, which has opened the door for further downside acceleration. There is an important release during the London session i.e. the German GFK consumer climate data will be released. This release might impact the Euro in the short term.

There was a major bullish trend line on the 4 hour chart for the EURGBP pair, which was broken during this week. Moreover, the pair has also breached the 100 moving average (4H), which might encourage the Euro sellers in the short term. The EURGBP pair is currently testing an important confluence support area. The 200 moving average (4H), and the 50% fib retracement level of the last leg higher from the 0.7875 low to 0.8036 high sits around the 0.7955 level. There is a chance that the pair might bounce a bit from the current levels, but if that happens, then it might find resistance around the broken trend line. If the Euro sellers manage to defend the 100 moving average, then there might be a chance of another move lower in the short term.

On the upside, initial resistance can be seen around the 100 moving average, followed by the 0.7980 level. Alternatively, if the pair breaks down, there the next level of interest will be around the 61.8% fib level where buyers could reappear.

Overall, selling rallies looks like a good option if the pair continues to trade below the 0.79780 level.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

USDJPY Forming A Short Term Breakout Pattern

The US dollar surged higher above the 104.00 level against the Japanese yen recently, and since then the USDJPY pair was seen consolidating in a range. There was no economic release scheduled yesterday, so there was no such reason for the US dollar traders to ignite volatility in the pair. However, the pair is forming a short-term breakout pattern, which is likely to be broken soon. There are a couple of economic releases lined up during today’s NY session, including the US GDP figures and the US pending home sales data. Any of these releases can cause a lot of volatility in the pair and pave way for a move higher or lower in the short term.

There is a critical flag pattern forming on the hourly chart for the USDJPY pair, which is likely to act as a pivot for the pair. Recently, the pair broke the 100 hourly moving average to test the flag support trend line. The US dollar buyers managed to hold the downside in the pair, but the mentioned break was a critical one. If the pair trades a bit higher from the current levels, then the 100 hourly moving average is likely to act as a resistance in the short term. If buyers fail to defend the flag support area, then a break below the 103.65 level might call for a run towards the 200 hourly moving average. Any further losses in that situation could take the pair towards the 50% fib retracement level of the last move higher from the 102.13 low to 104.27 high.

On the upside, initial resistance can be seen around the flag resistance area, followed by the previous high of 104.27.

Overall, selling with a small risk might be considered with a tight stop above the previous high.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

EURUSD Failed Around A Very Important Level

The Euro managed to find some bids during the last two days, and made an attempt to break higher against the US dollar. However, the upside was limited, as the EURUSD pair struggled to clear an important resistance zone around the 1.3220 level. The pair is now seen trading lower again. The economic releases were also not on the positive side for the Euro buyers, which might encourage the Euro sellers in the short term. There is an important economic release lined up during the London session today i.e. the Euro zone consumer price index data will be published. The market is expecting it to decline from 0.4% to 0.3%. If the outcome stays in line with the expectation or falls below, then the Euro might continue trading lower in the short term.

There is a critical bearish trend line on the hourly chart for the EURUSD pair, which was one of the reasons of the recent failure for the pair. Moreover, the 50% fib retracement level of the last drop from the 1.3292 high to 1.3152 low was also sitting around the mentioned trend line at the same time. So, we can say that the failure to move higher was from a very important technical level. The pair is likely to continue to trading lower in the short term, and if it manages to rise a bit from the current levels, then sellers might take a stand. The hourly RSI is now below the 50 mark, which support the bearish view moving ahead.

If the pair breaks the 100 hourly moving average, then there is a chance of a retest of the 1.3220 resistance area.

Overall, selling rallies looks like a good option in the short term if the pair stays below the 1.3220 level.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker

 

[team.ikofx]

USDCAD Likely Heading Higher Moving Ahead

The Canadian dollar gained sharply against most major currencies during this past week particularly on Friday after the Canadian GDP release. The Canadian GDP registered an impressive gain of 0.8%, compared to the expectation of 0.7%. The USDCAD pair spiked lower after the release, but the US dollar resiliency was unbreakable, and as a result the USDCAD pair reversed sharply from the 1.0810 low. The pair also managed to clear an important resistance around the 1.0850 level, which might cause one more leg higher in the pair in the short term.

There was a bearish trend line formed on the hourly chart of the USDCAD pair, which was breached during this past week. The USDCAD pair traded as high as 1.0878, which is just around the 38.2% fib retracement level of the last drop from the 1.0997 high to 1.0810 low. Moving ahead, the broken trend line might act as a strong support for the pair. So, if the pair moves a bit lower from the current levels towards the 1.0860 level, then the US dollar buyers might appear again. On the upside, initial resistance can be seen around the 50% fib retracement level, which also coincides with the 100 moving average. Any further strength might take the pair towards the 200 hourly moving average.

On the other hand, if the US dollar buyers fail to defend the broken trend line, then the USDCAD pair might drop towards the last low of 1.0810. The mentioned level holds a lot of importance in the short term, and must hold for further upside in the pair.

Overall, buying dips looks like a good option in the near term until the pair is trading above the 1.0810 support level.

-------------------------------------
Posted By IKOFX Technical Team: Online Forex Broker