(Jing Ren – Orbex)
EUR/USD in brief consolidation
The US dollar consolidated over flat retail sales in September. The euro has struggled to secure bids after it turned lower from the daily resistance and parity level. Sentiment would remain bearish unless the buy side manages to push past this ceiling. In the meantime, the pair is testing the demand zone between 0.9540 and 0.9650. A close above the recent support-turned-resistance 0.9810 would lift the price to 0.9900. On the downside, a bearish breakout would renew the selling pressure and send the single currency to 0.9450.
GBP/JPY tests major resistance
The pound steadied after the firing of the UK’s finance minister. A rally above the previous high at 165.50 has prompted sellers to cover their positions. Improved sentiment leans towards a bullish continuation. September’s high at 167.80 is the last hurdle and a breakout would pave the way for an extended rally above 170.00 in the days to come. The RSI’s overbought situation may cause a temporary pullback to test the bulls’ commitment. 164.50 and 162.30 are the two levels to expect accumulation.
GER 40 struggles to bounce
Equities slide as global uncertainties keep investors on their toes. The Dax 40 found support at the base of the bullish breakout (12000) from earlier this month. 12600 near the top of a previous rebound is a key resistance. Its breach would signal strong buying interest and trigger a bounce in the short-term. Otherwise, the market would remain cautious and the bears may double down for lack of opposition. A revisit of 12000 could put the current rebound at risk and extend losses to a two-year low at 11400.