. Daily Forex Analysis - EUR/USD resists, Pound nears highs.

Daily Forex Analysis – EUR/USD resists, Pound nears highs.

Daily Forex Analysis – EUR/USD resists, Pound nears highs.

11 Jul 2024

Introduction

The EUR/USD climbs but faces resistance ahead of key US inflation data. A softer dollar lifts the pair, but political uncertainty in France and the upcoming CPI report could limit gains. The British Pound and New Zealand Dollar also rise on US rate cut bets and strong UK data, while the USD/CAD holds steady before US inflation figures.

Markets In Focus Today – EUR/USD

EUR/USD Price Analysis Descending trend line resistance to cap gains ahead of US CPI.

EUR/USD gains positive traction for the second successive day amid a softer USD.The technical setup favors bullish traders and supports prospects for further gains.Political uncertainty in France might cap gains ahead of the crucial US CPI report.The EUR/USD pair attracts buyers for the second successive day on Thursday and moves back closer to a nearly four-week high touched on Monday. Spot prices, however, remain below mid-1.0800s as traders await the release of the US consumer inflation figures before placing fresh directional bets. Heading into the key data risk, growing acceptance that the Federal Reserve (Fed) will start cutting interest rates in September keeps the US Dollar (USD) bulls on the defensive and continues to lend some support to the EUR/USD pair. That said, the poll results of the second round of the French parliamentary elections raise the possibility of a hung parliament. This could act as a headwind for the shared currency and keep a lid on any further appreciating move for the major.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0802 | Positive Crossover | Bullish
  • MA 20 : 1.0784 | Positive Crossover | Bullish
  • MA 50 : 1.0782 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.0794 | Positive Crossover | Bullish
  • MA 20 : 1.0754 | Positive Crossover | Bullish
  • MA 50 : 1.0794 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 60.2340 | Buy Zone | Bullish

Stochastic   Oscillator : 90.8620 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 1.0860 R2 : 1.0919
  • S1 : 1.0669 S2 : 1.0610

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 1.0833 | Take Profit : 1.0882 | Stop Loss : 1.0804

GBP/USD

Pound Sterling approaches annual highs on strong UK GDP, BoE rate-cut bets fade.

The Pound Sterling performs strongly against the US Dollar and other currencies on faster UK GDP growth and a decline in BoE rate-cut prospects.The UK economy expanded at a faster pace of 0.4% in May, beating an estimate of 0.2%.Investors await the US inflation data for fresh guidance on the Fed’s interest rates path.The Pound Sterling (GBP) rallies to near 1.2870 and approaches the year-to-date high against the US Dollar (USD) in Thursday’s London session. The GBP/USD pair strengthens due to multiple tailwinds, such as weakness in the US Dollar due to firm speculation that the Federal Reserve (Fed) will begin reducing interest rates in September and an upbeat outlook for the British currency amid easing Bank of England’s (BoE) early rate cut bets and strong United Kingdom (UK) Gross Domestic Product (GDP) report for May.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2782 | Positive Crossover | Bullish
  • MA 20 : 1.2747 | Positive Crossover | Bullish
  • MA 50 : 1.2702 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.2760 | Positive Crossover | Bullish
  • MA 20 : 1.2717 | Positive Crossover | Bullish
  • MA 50 : 1.2697 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 67.5822 | Buy Zone | Bullish

Stochastic   Oscillator : 91.1766 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 1.2800 R2 : 1.2859
  • S1 : 1.2611 S2 : 1.2552

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 1.2844 | Take Profit : 1.2944 | Stop Loss : 1.2793

NZD/USD

NZD/USD appreciates to near 0.6100 as traders await US inflation.

NZD/USD rebounds ahead of US Consumer Price Index (CPI) data scheduled for Thursday.The US core CPI is expected to remain steady at 3.4% year-over-year in June.The New Zealand Dollar may limit its upside due to dovish sentiment surrounding the RBNZ.NZD/USD recovers its recent losses, trading around 0.6090 during the European session on Thursday. Traders await the release of the upcoming US Consumer Price Index (CPI) data for June, scheduled for release on Thursday, for more clarity on the Federal Reserve’s (Fed) monetary policy direction. The New Zealand Dollar (NZD) faced pressure following the Reserve Bank of New Zealand’s (RBNZ) dovish monetary policy statement. The central bank held its cash rate steady at 5.5% on Wednesday as expected but hinted at possible rate cuts in August if inflation decreases as anticipated.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.6105 | Negative Crossover | Bearish
  • MA 20 : 0.6109 | Negative Crossover | Bearish
  • MA 50 : 0.6098 | Negative Crossover | Bearish

Simple :

  • MA 10 : 0.6102 | Negative Crossover | Bearish
  • MA 20 : 0.6110 | Negative Crossover | Bearish
  • MA 50 : 0.6107 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 45.8184 | Neutral Zone | Neutral

Stochastic   Oscillator : 47.3485 | Neutral Zone | Neutral

Resistance   And Support Levels :

  • R1 : 0.6186 R2 : 0.6225
  • S1 : 0.6061 S2 : 0.6022

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 0.6104 | Take Profit : 0.6058 | Stop Loss : 0.6135

USD/CAD

USD/CAD Price Trades in tight range above 1.3600 ahead of US Inflation.

USD/CAD stays sideways near 1.3600 with US inflation in focus.The core CPI is estimated to have grown steadily by 3.4% on monthly as well as annual basis.Easing Canadian labor market conditions boost BoC’s rate-cut prospects.The USD/CAD pair consolidates in a tight range above the round-level support of 1.3600 in Thursday’s European session. The Loonie asset turns sideways as investors await the United States (US) consumer inflation data for June, which will be published at 12:30 GMT. The US Consumer Price Index (CPI) report is expected to show that annual and monthly core inflation, which excludes volatile food and energy prices, grew steadily by 3.4% and 0.2%, respectively. Annual headline inflation is estimated to have decelerated to 3.1% from 3.3% in May. Meanwhile, the Canadian Dollar is under pressure amid growing speculation that the Bank of Canada (BoE) will deliver subsequent rate cuts. Deteriorating Canadian labor market conditions have boosted expectations of more rate cuts by the BoE.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.3645 | Negative Crossover | Bearish
  • MA 20 : 1.3661 | Negative Crossover | Bearish
  • MA 50 : 1.3665 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.3649 | Negative Crossover | Bearish
  • MA 20 : 1.3673 | Negative Crossover | Bearish
  • MA 50 : 1.3675 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 44.0346 | Neutral Zone | Neutral

Stochastic   Oscillator : 15.8803 | Sell Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.3763 R2 : 1.3807
  • S1 : 1.3618 S2 : 1.3574

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 1.3640 | Take Profit : 1.3584 | Stop Loss : 1.3683

Elsewhere In The Forex Market

AUD/USD up 0.18% to 0.6759, The USD/CHF down 0.12% to 0.8985. The EUR/GBP down 0.03% at 0.8426. EUR/AUD down 0.01% at 1.6048. AUD/NZD down 0.02% at 1.1094, The USD/CNY down 0.11% at 7.2671, AUD/SEK down 0.03% at 7.1107, at the time of writing.

Key Economic Events & Data Release Today:

(EUR) German CPI (MoM) (Jun) Forecast 0.1%, Previous 0.1% at 02:00. (GBP) GDP (YoY) (May) Forecast 1.2% Previous 0.6% at 02:00. (GBP) GDP (MoM) (May) Forecast 0.2%, Previous 0.0% at 02:00. (USD) CPI (MoM) (Jun) Forecast 0.1%, Previous 0.0% at 08:30. (USD) Core CPI (MoM) (Jun) Forecast 0.2%, Previous 0.2% at 08:30. (USD) Initial Jobless Claims Forecast 1,860K, Previous 1,858K at 08:30