Daily Analysis Forex Mix

[radex78]

The Australian Dollar retreated due to the strengthening US Dollar.

The AUD/USD pair has shown a bearish trend; although both central banks lean towards a hawkish stance, USD demand has been stronger, driven by safe-haven flows. According to the FXOpen chart, AUD/USD formed a bearish candle on September 24, closing at approximately 0.70086, with a high of 0.70451 and a low of 0.70057.

The RBA has maintained the cash rate at 4.35%, but Governor Michele Bullock noted that core inflation risks remain at 3.6%—above the 2–3% target—and the market anticipates a high probability of a rate hike at the September 29 meeting. This factor could limit the AUD's decline.

Australia added approximately 39,500 jobs in August, well above the expected figure of around 20,000. However, the unemployment rate rose from 4.5% to 4.6%, resulting in mixed data. Employment figures and slowing domestic economic growth limit the RBA's room to raise interest rates more aggressively without disrupting economic activity.

As a commodity-proxy currency, the AUD is highly sensitive to price dynamics in iron ore and copper, as well as the outlook for China's economic recovery. The Xi-Trump meeting is a major focus, as developments in US-China trade relations could influence risk sentiment and China's economic outlook. If the meeting boosts optimism regarding global trade, the AUD could receive a boost; conversely, if new tensions arise, the AUD could come under pressure.

The US Dollar continues to draw strength from market expectations that the Fed will keep interest rates higher for longer to curb inflation. The Fed raised rates by 25 basis points to a range of 3.75%–4.00% on September 16 and signaled that further hikes might be necessary, as inflation is not yet fully under control.

US PCE inflation in July stood at 3.7%, well above the Fed's 2% target. Additionally, the USD has received a boost from safe-haven sentiment. High global geopolitical uncertainty is driving global capital flows back into the USD as a safe-haven currency.

From a technical perspective, AUD/USD has crossed below the 200-day EMA, signaling a bearish outlook. However, this does not yet represent a strong fundamental bearish trend, as expectations of RBA interest rate hikes continue to provide a buffer for the AUD. The projected price range for AUD/USD is 0.69700–0.71400. Immediate support is around 0.70000, with the next target at approximately 0.69800. Immediate resistance is around 0.70500, with the next target at approximately 0.71000. This forecast could be wrong.

AUD/USD D1

On the daily chart, AUDUSD is trading outside the lower Bollinger Band. The bands appear to be expanding, indicating bearish sentiment and high volatility.

The MA50 below the middle band shows an upward channel, yet the price trading below this line indicates a downtrend. The MA200 near the lower band shows an upward channel, suggesting bullish sentiment over the longer term.

The TDI indicator's VB High is at 75, and VB Low is at 40; the 35-point spread reflects the daily volatility level.

The Market Base Line is at 58 with a downward channel, meaning bullish weight exceeds bearish weight, though there is potential for a decline.

The RSI Price Line is at 30 with a downward channel, indicating the downtrend is in oversold territory.

The Trade Signal Line is at 40 with a downward channel, indicating a downtrend.

AUDUSD H4

On the 4-hour chart, AUDUSD is trading near the lower Bollinger Band. The bands appear to be expanding, indicating bearish sentiment and high volatility.

The MA50 above the middle band shows a downward channel, and the price trading well below this line indicates a downtrend. The MA200 below the upper band shows a flattening upward channel, suggesting weakening bullish sentiment over the longer term.

The TDI indicator's VB High is at 56, and VB Low is at 20; the 26-point spread reflects the 4-hour volatility level.

The Market Base Line is at 38 with a downward channel, meaning bearish weight exceeds bullish weight.

The RSI Price Line is at 20 with a flat channel, indicating sideways movement within oversold territory.

The Trade Signal Line is at 22 with a flattening downward channel, indicating a fading downtrend.

 

[radex78]

EUR/JPY caught in a tug-of-war between central bank policies

The EUR/JPY cross-pair is exhibiting interesting price dynamics characterized by high volatility. Recently, the pair experienced a sharp decline, forming a long-bodied bearish candle with virtually no wicks. Prices dropped from a high of 180.797 to a low of 178.917, closing at 178.972 on the FXOpen chart.

Fundamental factors remain relatively supportive for the Euro. The ECB raised interest rates by 25 basis points on September 10, bringing the deposit rate to 2.50%. The ECB also raised its inflation projections for 2027 and 2028, noting that inflationary pressures stemming from energy prices remain a significant risk. Major institutions like Goldman Sachs anticipate the deposit rate could reach 2.75%, while BofA also sees the possibility of a 25-basis-point hike in December.

These factors support the Euro by maintaining a substantial interest rate spread against Japan. However, a headwind for the Euro comes from rising energy prices driven by geopolitical conflicts, which are fueling inflation while simultaneously dampening European economic growth.

Regarding the JPY, the Bank of Japan (BoJ) recently raised interest rates to 1.25%—the highest level in approximately 31 years. However, the market does not view this move as fully hawkish, leaving the JPY vulnerable to continued pressure. On the other hand, Japan has signaled the possibility of foreign exchange intervention. There were even earlier reports of "rate checks" by Japanese authorities, a move that typically makes traders cautious about taking aggressive short positions.

Key items on today's economic calendar include the BoJ's Monetary Policy Meeting Minutes and the Corporate Services Price Index. However, a speech by ECB President Lagarde is the primary focus for the Euro. If Lagarde signals further rate hikes, the Euro could receive a boost; conversely, a dovish tone could weigh on the currency. Several Fed officials are also scheduled to speak, meaning USD sentiment or global risk appetite could indirectly impact EURJPY.

Technically, EURJPY is trading below the 200-day EMA; however, the decline has been sharp enough to prompt traders to watch for a potential rebound. The projected range for EURJPY is 178.000–181.000. Immediate support lies around 178.800, with the next target at approximately 178.300. Immediate resistance is around 180.000, with the next target at approximately 180.800. This forecast could be wrong.

EURJPY D1

Traders are awaiting today's market opening. EURJPY is below the lower Bollinger band. The Bollinger bands form a descending channel with wide spacing, indicating bearish sentiment and high volatility.

The MA50, situated between the upper and middle bands, forms a descending channel; the price remaining well below this line indicates a downtrend. The MA200 above the MA50 forms a gently sloping channel, indicating fading long-term bullish sentiment.

The TDI indicator's VB High reads 64, and VB Low reads 23; the 41-point spread reflects the daily volatility level.

The Market Base Line reads 43 with a flat channel, implying that bearish weight outweighs bullish weight.

The RSI Price Line reads 42 with a downward-curving channel, indicating the onset of a downtrend.

The Trade Signal Line reads 41 with a gently rising channel, indicating a fading uptrend.

EURJPY H4

On the 4-hour chart, EURJPY is positioned below the lower Bollinger band. The bands appear to be expanding after a consolidation phase, indicating increased market volatility.

The MA50, located below the middle band, forms a flat channel; the price remaining below this line indicates a downtrend. The MA200, well above the upper band, forms a horizontal channel, indicating sideways movement over a longer timeframe.

The TDI indicator's VB High reads 69, and VB Low reads 40; the 29-point spread reflects 4-hour volatility.

The Market Base Line reads 54 with a descending channel, implying bullish weight outweighs bearish weight, but a decline is possible.

The RSI Price Line reads 33 with a descending channel, indicating a downtrend.

The Trade Signal Line reads 43 with a descending channel, indicating a downtrend.

 

[radex78]

XAUUSD fell approximately 4% to the $4,110 level, a low not seen since August 5.

Gold prices faced significant downward pressure on September 28, dropping sharply by around 4%. Prices fell from a high near $4,279 to a low around $4,110 within a single day. Currently, gold is trading near $4,113 on the FXOpen chart, marked by a long bearish candle.

The primary drivers of this decline were rising US Treasury yields, a strengthening US dollar, and expectations that the Federal Reserve might still raise interest rates.

The 10-year US Treasury yield is hovering in the 4.9%–5.0% range. Following the Fed's 25-basis-point rate hike—bringing the target range to 3.75%–4.00%—the central bank reaffirmed its commitment to curbing inflation. These high interest rates and Treasury yields increase the opportunity cost of holding gold—a non-yielding asset—acting as a major drag on XAUUSD.

According to the CME FedWatch tool, the market currently estimates a roughly 70.3% probability of a Fed rate hike in October. The US Dollar Index (DXY) remains firm above the 100 level. Meanwhile, persistently high global crude oil prices are fueling fears of renewed inflation, reinforcing expectations that the Fed will not loosen policy anytime soon.

Tensions surrounding the Strait of Hormuz and the US-Iran conflict continue to support oil prices. This potential for rising inflation, combined with expectations of high Fed interest rates, has kept gold prices under pressure.

Gold is currently finding support from safe-haven demand driven by geopolitical dynamics in the Middle East and continued accumulation by global central banks, preventing a steeper decline.

Two key US economic data releases relevant to gold are scheduled for today: JOLTS Job Openings and the Conference Board Consumer Confidence index. If the data for both are strong, the USD could rise, potentially causing XAUUSD to turn bearish. Conversely, if the data weakens significantly, expectations for a Fed rate hike would diminish, and XAUUSD could rebound.

However, interestingly, it is not just today that matters. September 30th brings the ADP report, revised US GDP, and PCE/personal income data. Today, traders will be closely monitoring US Treasury yields, the DXY, JOLTS data, US consumer confidence, statements from Fed officials, and oil prices or news regarding the Strait of Hormuz.

From a technical perspective, the price of gold is trading well below the EMA200. The projected range for XAUUSD is between $4,000 and $4,400. Immediate support is around $4,100, with the next target at $4,050. Immediate resistance is around $4,200, with the next resistance target around $4,270. This forecast could be wrong.

XAUUSD D1

The daily gold price is below the lower band. The Bollinger Bands appear to be expanding, indicating increased volatility.

The MA50, below the middle band, traces an upward channel; the price sitting below this line indicates a downtrend. The MA200, above the upper band, traces a slight upward channel, indicating weak bullish sentiment over the longer term.

The TDI indicator's VB High reads 71 and the VB Low reads 36; the 35-point difference reflects the daily volatility level.

The Market Base Line reads 54 with a downward channel, implying that bearish weight outweighs bullish weight and there is potential for a decline.

The RSI Price Line reads 38 with a downward channel, indicating a downtrend.

The Trade Signal Line reads 44 with a downward-curving channel, indicating a downtrend.

XAUUSD H4

On the four-hour chart, the gold price is below the lower band. The Bollinger Bands appear to be expanding and tracing a downward channel, indicating bearish sentiment and high volatility.

The MA50, between the middle and upper bands, traces a downward channel; the price sitting well below this line indicates a downtrend. The MA200, above the upper band, traces a flat upward channel, indicating sideways movement over the longer term.

The TDI indicator's VB High reads 55 and the VB Low reads 25; the 30-point difference reflects the four-hour volatility level.

The Market Base Line reads 40 with a downward channel, implying that bearish weight outweighs bullish weight.

The RSI Price Line reads 21 with a downward channel, indicating a downtrend within oversold territory.

The Trade Signal Line reads 26 with a downward channel, indicating a downtrend.