. Daily Forex Analysis - EUR/USD Tests Symmetrical Triangle, GBP/USD Steady

Daily Forex Analysis – EUR/USD Tests Symmetrical Triangle, GBP/USD Steady

Daily Forex Analysis – EUR/USD Tests Symmetrical Triangle, GBP/USD Steady

14 May 2024

Introduction

EUR/USD tests the upper boundary of a symmetrical triangle around 1.0800, potentially shifting momentum towards a bullish trend. Currently trading near 1.0780, the pair shows an upward MACD momentum. Meanwhile, GBP/USD holds steady near 1.2550 ahead of unemployment data, and USD/CHF extends gains amid Fed’s rate stance. USD/JPY eyes the US PPI data, trading around 156.20.

Markets In Focus Today – EUR/USD

EUR/USD Price Tests the upper boundary around the level of 1.0800.

EUR/USD could test the upper boundary of the symmetrical triangle.Breaking above the upper boundary could potentially shift momentum toward a bullish trend. EUR/USD has recovered its recent gains registered in the previous session, trading around 1.0780 during the Asian session on Tuesday. From a technical perspective, analysis indicates a sideways trend for the pair as it continues to lie within the symmetrical triangle. A surpassing of the upper boundary could shift the momentum toward a bullish trend. However, the momentum indicator Moving Average Convergence Divergence (MACD) indicates an upward momentum for the EUR/USD pair.The Dollar’s pullback coincided with a widespread negative session in US yields across various maturities, always against the unchanged macro environment, which continues to see the Federal Reserve (Fed) beginning its easing cycle in September vs. an earlier start of interest rate cuts by the European Central Bank (ECB), probably in June.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0760 | Positive Crossover | Bullish
  • MA 20 : 1.0747 | Positive Crossover | Bullish
  • MA 50 : 1.0767 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.0760 | Positive Crossover | Bullish
  • MA 20 : 1.0721 | Positive Crossover | Bullish
  • MA 50 : 1.0785 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 56.0718 | Buy Zone | Bullish

Stochastic   Oscillator : 67.12 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.0826 R2 : 1.0893
  • S1 : 1.0609 S2 : 1.0542

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Stop Buy : 1.0805 | Take Profit : 1.0869 | Stop Loss : 1.0768

GBP/USD

GBP/USD clings to near 1.2550 ahead of Unemployment Rate.

GBP/USD holds its position around the major level of 1.2550 due to improved risk sentiment.Unemployment Rate (3M) is expected to show an increase in unemployed workers.Fed Vice Chair Philip Jefferson has advocated for maintaining current interest rates until signs of inflation easing become apparent.GBP/USD hovers around 1.2560 during the Asian session on Tuesday following the improved risk appetite. The Pound Sterling (GBP) received support from higher-than-anticipated UK Gross Domestic Product (GDP) figures released on Friday. The UK economy expanded by 0.6% in Q1, surpassing expectations and signaling the end of the country’s brief recession. This robust economic rebound represents the strongest growth seen in over two years. Market participants are now turning their attention to employment data expected later in the day. There are anticipations of an increase in the number of individuals claiming jobless benefits in April, as indicated by the UK Claimant Count Change. Additionally, the ILO Unemployment Rate (3M) is expected to show a rise in the number of unemployed workers in the UK.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2528 | Positive Crossover | Bullish
  • MA 20 : 1.2525 | Positive Crossover | Bullish
  • MA 50 : 1.2560 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.2531 | Positive Crossover | Bullish
  • MA 20 : 1.2494 | Positive Crossover | Bullish
  • MA 50 : 1.2592 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 52.5435 | Buy Zone | Bullish

Stochastic   Oscillator : 89.35 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.2657 R2 : 1.2754
  • S1 : 1.2345 S2 : 1.2248

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Stop Buy : 1.2556 | Take Profit : 1.2629 | Stop Loss : 1.2513

USD/CHF

USD/CHF extends gains to near 0.9100 ahead of US PPI.

USD/CHF appreciates as the Fed is expected to maintain higher interest rates for longer.Fed Vice Chair Philip Jefferson has advocated for keeping rates higher until signs of inflation easing become clear.The Swiss Franc may encounter selling pressure as the SNB intensifies its focus on combating inflation.USD/CHF continues to gain ground for the third successive session, trading around 0.9090 during the Asian hours on Tuesday. The US Dollar edges higher against the Swiss Franc (CHF) due to cautious statements from Federal Reserve (Fed) officials, emphasizing the importance of maintaining higher rates for longer given the elevated inflation. Fed Vice Chair Philip Jefferson reiterated this stance on Monday, advocating for keeping current interest rates until signs of inflation easing emerge. On Tuesday, traders will likely watch the US Producer Price Index (PPI), a pivotal economic indicator. The PPI report could significantly impact the US market. Traders may use the PPI data to assess the potential outcome of the Consumer Price Index (CPI). If the PPI data exceeds expectations, it could further strengthen the US Dollar.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.9081 | Negative Crossover | Bearish
  • MA 20 : 0.9083 | Negative Crossover | Bearish
  • MA 50 : 0.9018 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.9080 | Negative Crossover | Bearish
  • MA 20 : 0.9102 | Negative Crossover | Bearish
  • MA 50 : 0.9018 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 50.7892 | Buy Zone | Bullish

Stochastic   Oscillator : 89.96 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 0.9201 R2 : 0.9248
  • S1 : 0.9051 S2 : 0.9004

Overall Sentiment : Neutral Market Direction : Buy

Trade Suggestion : Stop Buy : 0.9093 | Take Profit : 0.9176 | Stop Loss : 0.9043

USD/JPY

USD/JPY extends the rally above 156.00, eyes on US PPI data.

USD/JPY extends its upside near 156.20 in Tuesday’s early Asian session. Investors will monitor the US PPI figure on Tuesday, which is estimated to rise 2.2% YoY in April. The BoJ cut the amount of Japanese government bonds it offered to buy in a regular purchase operation.The USD/JPY pair extends the rally around 156.20 during the early Asian trading hours on Tuesday. The Japanese Yen loses ground against the US Dollar (USD) despite the hawkish signal from the Bank of Japan (BoJ) to cut purchases of Japanese government bonds on Monday and the downbeat Nonfarm Payrolls (NFP) for April last week. Investors will take more cues from the key US economic data this week, including the Producer Price Index (PPI), Consumer Price Index (CPI), and Retail Sales. On the JPY’s front, the Bank of Japan (BoJ) sent a hawkish signal on Monday by reducing the amount of Japanese government bonds (JGBs) it offered to buy in a regular purchase operation. This move is expected to put upward pressure on Japanese bond yields and possibly narrow the gap between Japan and the United States, which has weakened the JPY.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 155.4688 | Positive Crossover | Bullish
  • MA 20 : 154.9134 | Positive Crossover | Bullish
  • MA 50 : 153.1504 | Positive Crossover | Bullish

Simple :

  • MA 10 : 154.8576 | Positive Crossover | Bullish
  • MA 20 : 155.2340 | Positive Crossover | Bullish
  • MA 50 : 152.5828 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 60.9078 | Buy Zone | Bullish

Stochastic   Oscillator : 100.00 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 159.8369 R2 : 162.0561
  • S1 : 152.6531 S2 : 150.4339

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 155.92 | Take Profit : 157.81 | Stop Loss : 154.86

Elsewhere In The Forex Market

USD/CAD up 0.08% to 1.3677, The NZD/USD up 0.5% to 0.6020. The EUR/GBP up 0.6% at 0.8596. AUD/USD down 0.09% at 0.6601. AUD/NZD down 0.15% at 1.0965, The USD/CNY up 0.07% at 7.2374, AUD/SEK up 0.07% at 7.1695, at the time of writing.

Key Economic Events & Data Release Today:

(GBP) Claimant Count Change (Apr) Forecast 13.9K, Previous 10.9K at 11:30. (GBP) Average Earnings Index + Bonus (Mar) Forecast 5.3%, Previous 5.6% at 11:30. (EUR) German CPI (MoM) (Apr) Forecast 0.5%, Previous 0.4% at 11:30. (CAD) Wholesale Sales (MoM) (Mar) Forecast –0.9%, Previous 0.0% at 18:00. (USD) PPI (MoM) (Apr) Forecast 0.3%, Previous 0.2% at 18:00. (USD) Fed Chair Powell Speaks at 19:30.