Looking at the U.S Dollar price action ahead of Janet Yellen speech in Jackson Hole, the Greenback bounced on Friday on the back of profit taking due to the weekly close.
The Dollar recovered near 94.00 weekly support, however, an important bearish trend line that comes from 96.00 peak in the hourly chart keep acting as a strong resistance. This trend line coincide with the hourly resistance level that stands at 95.90, and consequently we expect the Dollar to remain under pressure below this near-term resistance zone.
Overall, the bearish trend remain intact below 96.00 area in the daily chart, while in the hourly chart, if the recent recovery may find an end around 95.90 for another dip below 94.00 support to begin.
The Euro fell into a short-term corrective wave yesterday as the Dollar strengthened on the back of strong new home sales data in Tuesday.
Technically, the single currency has turned bullish in the near-term and as far as prices keep trading above 1.1220/40 support zone, the pair may continue to head north in the coming sessions. Looking at the short-term price action, the Euro still need another push above 1.1330 hourly resistance to confirm another extension in the direction of 1.1400 psychological barrier.
In the meantime, prices should not break below 1.1240 support to maintain the actual bullish momentum.
The Sterling remain positive in the hourly chart after the recent rally seen lately. As of now, the focus is on 1.3370/1.3420 resistance zone and only a break this level will increase the probability of a bullish reversal in the daily chart.
While in the hourly chart, the pair need to overtake 1.3270/80 barrier in order to reinforce the positive signs given earlier this week. In the flipside, as far as 1.3025 low is in place, cable should keep trading sideways to higher in the coming days.
In the short-term, a drop towards 1.3150 level should provide a strong support to the pair, and therefore, another extension higher is likely in the coming days after the actual correction ends.
After several attempts to break above 1357 hourly resistance that failed. Prices succeeded to break below the support zone of 1333/1328 in the daily chart, which triggered a big sell-off in the yellow metal.
Technically, gold turned bearish in the near-term as prices has shown three consecutive lower highs (1375-1367-1357) from the yearly peak of $1375, which reinforces the probability of further weakness in the coming days. As of now, gold can be heading towards 1315 support followed by 1310 in extension, while in the upside; a bounce towards 1330 resistance area should find strong sellers for another dip to the downside.
To summarize, gold remain under pressure and the upside potential is likely to be limited.
The pair keep trading sideways in the near-term between 0.7650 level in the upside and 0.7580 level to the downside and it is preferable to wait for further price action development to confirm the next directional move in this pair.
Looking at the recent price action, the Aussie remain positive in the daily chart, while in the hourly chart the pair is trading sideways to lower. From a technical standpoint, as far as prices keep trading below 0.7655 peak, the probability of a correction to the downside will persist but traders should wait for a close below 0.7580 support to confirm a technical breakdown in the direction of 0.7548 daily support.
USD/CAD jumped during last week from the 61.8% of the entire recovery that began from 1.2445 low and therefore, we were expecting to see strong buyers around this level, which stands at 1.2765.
The pair has reached as high as 1.2965 level before to retreat lower. Meanwhile, when looking at momentum indicators, we believe that this decline may be short lived and another re-test of 1.2965 peak or even higher remain possible as far as 1.2855 low is in place.
In the near-term, the hourly support stands at 1.2900 handle and only a break below it will weaken this positive view. In the flipside, a break above 1.2965 resistance can open the path for 1.3000 barrier.
The pair traded sideways since the beginning of the week on thin volume as traders awaits Janet Yellen speech in Jackson Hole tomorrow.
Technically, we have seen a strong reaction each time the pair tried to break below 100.00 psychological support. Bank of Japan officials eye this level, and we may continue to see some interventions from time to time around this level. Meanwhile, when looking at the daily chart, the pair keep printing lower highs/ lower lows since 114.90 peak and consequently the upside potential is likely to remain limited.
For the time being, the pair may continue its path in the direction of 99.00 (2016 low) followed by 98.00/97.50 monthly support zone in the coming weeks. This scenario should remain valid as far as prices keep trading below 102.80/103.55 barrier.
However, in the near-term a retracement to the upside remain cannot be ruled out and may target 100.90/101.20 resistance zone before the bearish pressure resume.
The Euro retreated on Friday as the Dollar strengthened across the board fueled by the rate hike bets from the U.S following Yellen comments in Jackson Hole.
Technically, the single currency turned bearish in the hourly chart after prices managed to break below 1.1240 support. Therefore, a continuation to the downside in the direction of 1.1160-1.1110 support zone remain possible during the week ahead before to see some demand in the pair. In the meantime, a retracement towards 1.1240/60 new resistance zone (former support) is likely to find strong sellers. In the daily chart, the trend remain bearish below 1.1365 (61.8% retracement from 1.1600 peak to 1.0900 low) and as far as prices keep trading below this level, the upside potential should be limited in the Euro.
After the recent rally seen in cable, the pair traded lower by the end of last week on the back of US Dollar strength.
From a technical standpoint, the Sterling remain positive in the hourly chart as far as 1.3025 support is in place. Meanwhile, the focus shifted to 1.3072 level, which represents the 50% retracement of the entire recovery that began from 1.2865 support.
Therefore, a bounce can happen around this level in the coming days and another extension towards 1.3170 resistance is likely. In the opposite, if the pair trades higher in the beginning of this week, then we expect sellers to appear between 1.3170 and 1.3196 resistance levels.
Looking at the biggest picture, the trend remain bearish in the daily/weekly charts and as far as 1.3370 peak is intact, any rally should be short-lived in this pair.
After several attempts to break above 1357 hourly resistance that failed, prices succeeded to break below the support zone of $1333/1328 in the daily chart, which can clear the path to a re-test of 1310-1305 support zone in the next days.
Technically, gold turned bearish in the near-term as prices has shown four consecutive lower highs (1375-1367-1357-1342) from the yearly peak of $1375, which reinforces the probability of further weakness in the coming days. As of now, $1322 represents the short-term resistance level while the most important barrier stands at 1328 for the week ahead.
To summarize, gold remain under pressure and the upside potential is likely to be limited.
