. Daily FX Analysis - Currency Chaos, Euro Slips, GBP Battles, USD/CAD Hits Lows.

Daily FX Analysis – Currency Chaos, Euro Slips, GBP Battles, USD/CAD Hits Lows.

Daily FX Analysis – Currency Chaos, Euro Slips, GBP Battles, USD/CAD Hits Lows.

29 Nov 2023

Introduction:

In currency markets, the EUR/USD is slipping below 1.1000 in anticipation of German inflation data, while GBP/USD contends with 1.2700 amid a pause in the US Dollar’s decline. NZD/USD retraces from three-month highs, and USD/CAD hovers near nine-week lows. The focus turns to key economic indicators and central bank speeches.

EUR/USD:

The EUR/USD has slipped below 1.1000 in anticipation of German inflation data.

In the European session on Wednesday, the EUR/USD is below 1.1000, experiencing a loss of upward momentum. Despite a decline in US Treasury bond yields, the US Dollar is stabilizing, keeping the pair steady. Traders are exercising caution in anticipation of German inflation and US GDP data.

On Tuesday, the EUR/USD pair is trading within familiar ranges, with investors exercising caution in anticipation of crucial first-tier data and upcoming speeches from central banks over the next few days.

On Wednesday, Germany is set to unveil the initial projections for the Harmonized Index of Consumer Prices (HICP) for November.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.0981 | Positive Crossover | Bullish
  • MA 20: 1.0936 | Positive Crossover | Bullish
  • MA 50: 1.0854 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.0981 | Positive Crossover | Bullish
  • MA 20: 1.0936 | Positive Crossover | Bullish
  • MA 50: 1.0839| Positive Crossover | Bullish

RSI (Relative Strength Index): 69.95| Buy Zone | Bullish

Stochastic Oscillator: 90.44| Buying Zone | Positive

Resistance And Support Levels:

  • R1: 1.1000| R2: 1.1125
  • S1: 1.0894| S2: 1.0780

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.1026 | Take Profit: 1.1125 | Stop Loss: 1.0966

GBP/USD:

As the US Dollar’s slide pauses, GBP/USD struggles above 1.2700.

In European trading on Monday, GBP/USD is struggling around the 1.2700 level, continuing its pullback from multi-month highs. Despite the hawkish remarks from BoE Governor Bailey, the pair is not gaining momentum, as the US Dollar seeks stability in anticipation of significant economic data and Federal Reserve commentary.

The British Pound maintains its resilience against the US Dollar, with GBP/USD securely trading above the 1.2600 mark. The pair reached its peak on Monday at 1.2644, marking its highest level since last August.

In terms of data, the UK macroeconomic schedule is relatively quiet for the current week.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.2677| Positive Crossover | Bullish
  • MA 20: 1.2589| Positive Crossover | Bullish
  • MA 50: 1.2474 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.2673 | Positive Crossover | Bullish
  • MA 20: 1.2585 | Positive Crossover | Bullish
  • MA 50: 1.2441 | Positive Crossover | Bullish

RSI (Relative Strength Index): 78.46| Buy Zone | Bullish

Stochastic Oscillator: 93.46| Buy zone | Neutral

Resistance And Support Levels:

  • R1: 1.2724| R2: 1.2892
  • S1: 1.2610| S2: 1.2499

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.2758| Take Profit: 1.2892 | Stop Loss: 1.2682

NZD/USD:

NZD/USD pulls back from its three-month highs but remains above the 0.6150 level.

NZD/USD reduces its intraday advances as the US Dollar makes an effort to recover.

During the early European session on Wednesday, NZD/USD retraces its intraday gains as the US Dollar stages a rebound. Nevertheless, the NZD/USD pair receives upward support following the release of the Reserve Bank of New Zealand (RBNZ) interest rate decision.

The members of the RBNZ board opted to maintain the interest rate at 5.50%, aligning with the widely anticipated market expectations.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 0.6145 | Positive Crossover | Bullish
  • MA 20: 0.6083| Positive Crossover | Bullish
  • MA 50: 0.6020 | Positive Crossover | Bullish

Simple:

  • MA 5: 0.6138 | Positive Crossover | Bullish
  • MA 20: 0.6077 | Positive Crossover | Bullish
  • MA 50: 0.6000| Positive Crossover | Bullish

RSI (Relative Strength Index): 70.24| Buying Zone| Bullish

Stochastic Oscillator: 86.7 |Buying Zone | Neutral

Resistance And Support Levels:

  • R1: 0.6188| R2: 0.6302
  • S1: 0.6093 | S2: 0.6000

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 0.6210 | Take Profit: 0.6302 | Stop Loss: 0.6159

USD/CAD:

USD/CAD is trading beneath 1.3550, hovering near its nine-week lows, with attention focused on upcoming US data.

During the Asian session on Wednesday, the USD/CAD pair hit a nine-week low at 1.3541 and is presently trading below 1.3550. The drop in the USD/CAD pair is linked to the accommodative comments made by US Federal Reserve (Fed) Governor Christopher Waller.

Waller’s indication that the Federal Reserve might not insist on keeping interest rates high in the face of persistent inflation decline is likely a factor contributing to the downward pressure on the USD/CAD pair.

Investors will now turn their attention to the preliminary Gross Domestic Product (GDP) Annualized for the third quarter in the US. The release of the Fed’s Beige Book will provide an overview of the overall economic growth in the United States.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.3581 | Negative Crossover | Bearish
  • MA 20: 1.3641| Negative Crossover | Bearish
  • MA 50: 1.3688| Negative Crossover | Bearish

Simple:

  • MA 5: 1.3579 | Negative Crossover | Bearish
  • MA 20: 1.3656| Negative Crossover | Bearish
  • MA 50: 1.3715| Negative Crossover | Bearish

RSI (Relative Strength Index): 32.77| Selling Zone | Bearish

Stochastic Oscillator: 10.09| Sell Zone | Negative

Resistance And Support Levels:

  • R1: 1.3648 | R2: 1.3756
  • S1: 1.3548 | S2: 1.3400

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 1.3506| Take Profit: 1.3400 | Stop Loss: 1.3584.

Elsewhere in the Forex Market

USD/CHF down 0.06% to 0.8774. The AUD/USD down 0.23% to 0.6633. The EUR/GBP down 0.09% at 0.8649. USD/JPY down 0.23% at 147.21, EUR/JPY down 0.21% at 161.64, The USD/CNY down 0.29% at 7.1255, AUD/SEK down 0.16% at 6.8514, at the time of writing.

Key Economic Events & Data Release Today:

(NZD) RBNZ Interest Rate Decision Actual 5.50%, Forecast 5.50%, Previous 5.50% at 06:30.

(NZD) RBNZ Press Conference at 07:30.

(EUR) German CPI (MoM) (Nov) Forecast –0.2%, Previous 0.0% at 18:30.

(USD) GDP (QoQ) (Q3) Forecast 4.9%, Previous 2.1% at 19:00.

(GBP) BoE Gov Bailey Speaks at 20:35.