A day closer to the big decision from the Fed and the Forex Markets are understandably quiet this morning. Forex traders will be positioning themselves or lightening their exposure depending on how brave they are feeling. May see liquidity dry up this afternoon and the ranges become tighter!
Dean's Daily FX Update – 20 September 2016
The EURUSD has found support on our daily chart at the 50% Fibonacci level. 1.1149 is about where we bounced and we see the MACD approaching the waterline, the EMA’s are turning but the stochastics in the middle of nowhere. 1.12 is quite a big psychological level and we will need to see if we can break that.
Similar action in GBPUSD. We bounced off support 1.2990 and it looks like we could extend that move. Off a daily chart the technical analysis looks to support that theory but Dean does appear convinced with the FOMC looming large.
The AUDUSD has been given a bit of a boost this morning with minutes from the RBA. The market rallied to the resistance in place at 0.7567 and then came off. The rally looks more convincing in this FX pair with the MA’s turning, MACD crossing the waterline and stochastics turning from a very oversold position.
The Kiwi (NZDUSD), bounced off the 50% Fib level at 0.7220. Displaying similar traits to the Aussie. Dean is concerned that the upside in this pair could be limited because of the definite resistance around 0.74 and a top at 0.7480 which does not leave as much upside. He would prefer to look at the Aussie.
The USDCAD is really on Dean’s radar. 1.3250 is right at the recent highs and looks to be forming a double top. This is being held back by the weakness in the oil price. On the stochastics, it is heavily overbought and there is some divergence forming. One thing to bear in mind is the BOC is speaking today which may push this through our support and resistance.
The USDZAR has been the big mover so far this week. We broke down and we now nearing some support at 13.88 – 92. This week could the week we close the gap in the Rand that took place when Pravin was at risk of being arrested. Dean did say at the time he was looking to trade this as a gap and so far he looks to be correct.
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