A bit of a strange day on the Forex markets yesterday. The dollar weakness is proving a bit baffling for Dean and can only be down to the summer time where the big players are perhaps out of the market. Some talk of people buying yield … where you buy into a currency which offers better interest rate returns than your own. The strange thing is the Aussies and the Kiwis have both indicated that they will look to cut rates in the near future.
Dean's Daily FX Update – 16 August 2016
The EURUSD has burst through previous resistance at 1.1180 and this could now become a level of support. Dean will be watching this carefully for divergence and a turn in the EMA’s and stochastics.
The AUDUSD is of real interest and looking to previous tops in March and April. It is one you may have to be patient on because these moves can be exaggerated and tend to overshoot. Wait for your confirmations before looking at shorts.
A very similar pattern is building out in the NZDUSD FX pair. Almost a mirror image of what is happening across the Tasman Sea.
The USDCAD is one Dean has taken off his watch list as a bit nervous of trading a currency that is so correlated to the oil price. As the oil price rises so the Loonie gets stronger.
The Yen is the one that has made a big move this morning. It has broken previous support at around 100.6 and now reaching the levels where the BOJ has said they may get involved. This could be followed by big fund buying so trade this one with caution from the short side.
The Rand seems to be struggling to break 13.25 level and if there is any USD strength today then this could bounce quite hard from these levels.
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