US dollar turned up after closing in red yesterday

US dollar turned up after closing in red yesterday

The market sentiment is mixed, but there are still interesting movements on the market.

Fundamentals

  • The UK government prolonged the deadline for the end of Brexit talks, which previously was scheduled for October 15. EU-UK negotiators haven’t made any progress so far, but a spirit of compromise and the expectation for a soon agreement underpinned the pound.
  • US Core Producer Price Index came out better than analysts expected: 0.4% vs. the forecast of 0.2%.
  • The morning Australian labor data was encouraging. The unemployment rate rose by 6.9%, which was less than the anticipated 7.0%. However, the aussie dipped on dovish RBA expectations as the central bank is planning to cut rates to 0.10% from the current record low of 0.25%. In addition, Goldman Sachs forecasted the RBA will ease the stimulus package at the November 3 meeting.
  • The Chinese CPI and PPI came out worse than analysts expected, pushing USD/CNH upwards.
Watch our daily trading plan!

Technical tips

EUR/USD

EUR/USD is headed up after a huge slump. The move above the 38.2% Fibonacci retracement level of 1.1765 will push the price to the 200-period moving average of 1.1790, which coincides with the 50 moving average on the daily chart. On the flip side, the move below the 100-period moving average of 1.1730 will push the euro lower to the 23.6% Fibo level of 1.1705. Keep an eye on EU news as there will be today the EU summit meeting and a speech of ECB’s President Lagarde.

EURUSDH4.png

Gold

XAU/USD has been trading in an ascending channel since late September. Now gold is touching its bottom, that’s why we may expect the price to reverse from it and move upwards. If it closes above $1 900, the way towards the resistance of $1 920 will be open. Support levels are $1 890 and $1 875.

XAUUSDH4.png

S&P 500

The stock index is sharply falling. It has just crossed the support of $3 470, clearing the way towards $3 445. The move below this level will open doors to the key psychological mark of $3 400, which S&P 500 has failed to break a few times in September. Resistance levels are $3 500 and $3 520.

S&P500H4.png

GBP/USD

The British pound is trading sideways around 1.3000. If it bounces off it, it may jump to the 50.0% Fibonacci level, where the pair may meet the strong resistance. On the flip side, the move below the area of 1.2980-1.3000 will push the price to the 100-period moving average of 1.2900.

GBPUSDH4.png

Follow up:

  • US Philly Fed Manufacturing Index and unemployment claims will be out at 15:30 MT time.
  • ECB’s Lagarde will speak at 19:00 MT time.

Check the economic calendar

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Similar

USD Holds the Line
USD Holds the Line

The US dollar index keeps rounding above the 103.60 historical support level. The buyers have already defended this level for three weeks, highlighting their interest in the greenback. Thus, buying USD looks less risky right now. 

US Dollar Prepares for the Pump
US Dollar Prepares for the Pump

On the H4 timeframe, the US dollar index has formed a bullish falling wedge. At the beginning of the trading session, the price is testing the upper border of this wedge. Thus, in case of a higher-than-expected Core PCE Price Index m/m, the US dollar will skyrocket against other currencies. 

Uptrend in Gold Starts Now
Uptrend in Gold Starts Now

Happy Wednesday, traders! We went through the Internet and found the best news for you, take a look!

Latest news

Market Crash Incoming?
Market Crash Incoming?

This week may be the most important since the year started as the Fed assess the economic outlook and the US presents fresh NFP readings.

What Currency Will Overperform?
What Currency Will Overperform?

S&P Global, a private banking company, will release a monthly change in British Flash Manufacturing Purchasing Managers Index (PMI) on January 24, 11:30 GMT+2. The index is a leading indicator of economic health as businesses react quickly to market conditions, and purchasing managers hold the most current and relevant insight into the company's view of the economy.

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