19 Oct 2016
By Ipek Ozkardeskaya
GBP timid pre-labour data
The negative trend in the EURUSD is expected to remain in place heading into Thursday’s European Central Bank (ECB) meeting. Resistance is eyed at 1.1033 (minor 23.6% retracement on Sep 26th to Oct 14th fall), and 1.1080 (major 38.2% retracement). Breaking below 1.0951 (Jul 24th low), we could see a further extension of losses to 1.0910 (Jun 23rd low), before 1.0880/1.0850 area. Above 1.1080, the short-term bullish reversal could encourage a further rise to 1.1118 (50% retrace) and 1.1156 (major 61.8% retrace).
The USDJPY’s positive momentum is losing pace and compromising the possibility of a short-term attempt to 105.00/105.50 zone. The pair is testing the 200-hour moving average (103.76) on the downside. A minor support is eyed at 103.55 (minor 23.6% retracement on Sep 27th to Oct 13th rise), before the critical 102.89 (major 38.2% retracement), if broken, should suggest a short-term bearish reversal.
The GBPUSD attempted to pick up some positive momentum, yet the buyers remained timid above 1.2295 (major 38.2% retracement on Sep 29th to Oct 7th crash). If the UK’s unemployment data comes in line with expectations, we could see a successful attempt above 1.2295/1.2325 resistance area, toward 1.2440 (Fibonacci 50% level). Intra-day support is eyed at 1.2220/1.2230 (50, 100-hour moving averages), before 1.2145 (one-week ascending channel base).
The AUDUSD extended gains to 0.7691 in Sydney. The strengthening positive momentum encourages the development of a solid bullish trend for a potential test of 0.7710/0.7730 mid-term resistance. Intra-day supports are seen at 0.7647 (minor 23.6% retracement on Oct 13th to Oct 18th rise) and 0.7620 (major 38.2% retrace).
Gold extended recovery to $1264 in Asia. The mixed US dollar appetite is expected to reinforce support at $1250 (major 38.2% retracement on Dec 16th to Jun 5th rise), while the 200-day moving average ($1277) is seen as a solid ceiling, before $1297 (minor 23.6% retrace).
The WTI traded past $51 in Asia. Due today, the US crude oil inventories are expected to have increased by 2.2 million barrels, versus 4.9 million last week. If the decline in US crude inventories growth meets market expectations, the WTI could gain enough momentum to clear $52 resistance for a further surge toward the $53/$55 mid-term resistance. The key support is eyed at $48.92 (major 38.2% retracement on Sep 20th to Oct 10th rise), which should distinguish between a further positive attempt to $53/55 and a short-term bearish reversal to $47.93 (50% level).