daily FX market review

Daily Forex Market Review – 24 October 2016

The end of last week was dominated by dollar strength. Dean was watching three Forex pairs this morning to see if they could wrestle back some of the initiative. Mainly because they were showing signs of momentum slowing and they were at major resistance levels. Let’s see how we got on.

The AUSUSD was the first of the FX pairs Dean was interested in. His resistance was between 0.7640 – 0.7650. The market traded up to 0.7639 and now we are near the lows for the day at 0.76. A nice 40 pips to get the week started and we may not be finished there. Support at 0.7590 – 0.76.

Dean went for another commodity currency in the form of the USDCAD. The Loonie’s price is highly correlated to the oil price. There was plenty of news out of the OPEC countries this weekend so we expected to get a move. Oil continues to trade lower and so the USDCAD is higher. Dean saw resistance at 1.3325 – 1.3350. We are at the upper end of the range and may have to wait for confirmation before getting short.

The next on the watch list was USDCHF. We were watching this FX pair for shorts as it at multi-month highs. Resistance was between 0.9950 – 0.9985. The market traded up there in the early hours and is now lower and trading 0.9931. We will be hoping for a continuation of the weakness with a target of around 0.99. Stops too breakeven.

The dollar strength has resumed this afternoon against the NZDUSD and this is looking particularly weak technically. There is some support at current levels around 0.7135 but if this fails to hold then the next stop could be as low as 0.7070 where more major support exists.

The other pair to suffer at the hands of the dollar this afternoon looks to be the USDJPY. This has traded up from 103.75 to 104.35 where there is some resistance seen. Remember 104.40 was quite a key level in earlier reports and this may again prove to be the case.

Not too much data out tomorrow except for US consumer confidence. The ZAR is holding its own and does not seem to be too phased by all the political nonsense that is plaguing our airwaves. Very difficult to be short this one with a mini-budget scheduled for Wednesday.

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