Dean not seeing a lot apart from a possible bounce in the EURUSD after a strong sell off yesterday. He does go through how he exits his FX trades which is where many of us fail.
Dean's Daily FX Update – 21 October 2016
In the Zone
- EURUSD
Noteworthy News
- Fresh on the news that the UK are building trade agreements, the EU called for an emergency meeting to try salvage a free trade agreement between the EU and Canada. Is this a sign that there may be a hint of panic on the EU side around Brexit?
Recap
Conflicting comments within minutes from ECB President Draghi sent the EURUSD on a volatile journey yesterday. The first headline was that the ECB did not discuss extending QE (increasing money supply) which allowed the EUR to ratchet up near 1.1050. Shortly afterwards though, he commented that a sudden stop in QE was also not on the agenda, que the EURUSD to trade back towards 1.0915. I am looking for support at 1.0900 to hold, but am weary as a break lower targets 1.0850.
The USDJPY is prone to form ranges for extended periods and it looks as though we are starting to form one now, between 104.47 and 103.25. I don’t see much reason at this point for that range to break, and so I would be looking for another test of that upper resistance level at 104.47.
As expected, yesterday the commodity currencies – AUDUSD, NZDUSD and USDZAR – came under a little bit of pressure after a week of broad USD selling. I am looking for a continuation in some of these moves today and will use Fibonacci to dictate exit levels (discussed in today’s video.)
The GBPUSD is still a little lower this morning, I think my view on cable is clear and I am on the fence for this pair for now. I don’t see any reason why the market will not look for selling opportunities in this pair.
Daily FX Ranges
EURUSD
Resistance 1.0960 – 1.0980
Support 1.0860 – 1.0900
GBPUSD
Resistance 1.2276 – 1.2290
Support 1.2209 – 1.2170
AUDUSD
Resistance 0.7670 – 0.7680
Support 0.7629 – 0.7600
NZDUSD
Resistance 0.7210 – 0.7220
Support 0.7160 – 0.7130
USDCAD
Resistance 1.3270 – 1.3300
Support 1.3179 – 1.3150
USDJPY
Resistance 104.00 – 104.30
Support 103.60 – 103.30
USDCHF
Resistance 0.9957 – 0.9985
Support 0.9905 – 0.9895
USDZAR
Resistance 13.9900 – 14.0400
Support 13.8400 – 13.8091
Important Economic Data out today
- 14:30 CAD CPI
- 14:30 CAD Retail Sales
- 16:15 USD FOMC Member Tarullo Speaks
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