. Daily FX Analysis - EUR/USD, GBP/USD Navigate Surprises and Boosts.

Daily FX Analysis – EUR/USD, GBP/USD Navigate Surprises and Boosts.

Daily FX Analysis – EUR/USD, GBP/USD Navigate Surprises and Boosts.

24 Nov 2023

Introduction:

In the currency market update, the EUR/USD holds steady around 1.0900 following Germany’s IFO survey, while GBP/USD sees a rebound above 1.2550 amidst a weaker US Dollar. The Australian Dollar stabilizes, awaiting US PMI data, and USD/CHF consolidates below 0.8850 amid speculation about Fed interest rate hikes and SNB actions.

EUR/USD:

ECB The EUR/USD remains stable around the 1.0900 level following the release of Germany’s IFO survey results.

On Friday, the EUR/USD maintained its position within a limited range near 1.0900, despite Germany’s IFO sentiment data falling below analysts’ expectations.

Investors will turn their attention to the S&P Global PMI data from the US later in the day for potential market momentum. It’s worth noting that US bond and stock markets are scheduled to close early.

The EUR/USD concluded Thursday with a second consecutive close in the negative, yet it successfully stabilized above.

The information from Germany indicated an improvement in the headline German IFO Business Climate Index, rising to 87.3 in November from 86.9 in October.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.0906 | Positive Crossover | Bullish
  • MA 20: 1.0884 | Positive Crossover | Bullish
  • MA 50: 1.0804 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.0906 | Positive Crossover | Bullish
  • MA 20: 1.0900 | Positive Crossover | Bullish
  • MA 50: 1.0787| Positive Crossover | Bullish

RSI (Relative Strength Index): 60.99| Buy Zone | Bullish

Stochastic Oscillator: 13.61| Selling Zone | Neutral

Resistance And Support Levels:

  • R1: 1.0923| R2: 1.1063
  • S1: 1.0829| S2: 1.0749

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.0954 | Take Profit: 1.1063 | Stop Loss: 1.0891

GBP/USD:

GBP/USD bounces back beyond 1.2550, with attention on US PMIs.

GBP/USD is above the 1.2550 mark, making gains during the European session on Black Friday. The pair is supported by a weaker US Dollar and robust UK PMI data. Nevertheless, a potential rise in US Treasury bond yields and overall market sentiment may constrain the upside for GBP/USD ahead of the US PMIs.

On Friday, GBP/USD maintained stability near 1.2550, following marginal gains observed on Thursday. The technical analysis of the pair indicates that the bullish bias remains intact as we approach the weekend.

During the latter part of the day, S&P Global is set to unveil Manufacturing and Services PMI data for the United States.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.2537| Positive Crossover | Bullish
  • MA 20: 1.2486| Positive Crossover | Bullish
  • MA 50: 1.2396 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.2534 | Positive Crossover | Bullish
  • MA 20: 1.2489 | Positive Crossover | Bullish
  • MA 50: 1.2376 | Positive Crossover | Bullish

RSI (Relative Strength Index): 68.94| Buy Zone | Bullish

Stochastic Oscillator: 60.53| Buy zone | Positive

Resistance And Support Levels:

  • R1: 1.2564| R2: 1.2743
  • S1: 1.2442| S2: 1.2320

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.2610| Take Profit: 1.2743 | Stop Loss: 1.2534

AUD/USD:

The Australian Dollar stabilizes in anticipation of US PMI data and remains subject to the influence of the Greenback.

The Australian Dollar faces challenges in sustaining its upward momentum as the US Dollar rebounds from recent losses on Friday. Nevertheless, the USD saw a slight decline on Thursday in a session characterized by low trading volumes due to the closure of US markets for Thanksgiving.

On Thursday, the AUD/USD increased in a subdued session with US markets shuttered, buoyed by a softer US Dollar. However, the upward movement was constrained, and a period of consolidation is anticipated until the next week.

Despite the data, the AUD/USD pair persisted in its upward movement with a bullish inclination, buoyed by a weakened US Dollar.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 0.6561 | Positive Crossover | Bullish
  • MA 20: 0.6532| Positive Crossover | Bullish
  • MA 50: 0.6481 | Positive Crossover | Bullish

Simple:

  • MA 5: 0.6561 | Positive Crossover | Bullish
  • MA 20: 0.6535 | Positive Crossover | Bullish
  • MA 50: 0.6474| Positive Crossover | Bullish

RSI (Relative Strength Index): 63.57| Buying Zone| Bullish

Stochastic Oscillator: 34.91 |Selling Zone | Neutral

Resistance And Support Levels:

  • R1: 0.6574| R2: 0.6678
  • S1: 0.6507 | S2: 0.6430

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 0.6602 | Take Profit: 0.6678 | Stop Loss: 0.6553

USD/CHF:

USD/CHF is in a consolidation phase in anticipation of US PMI data and is positioned below the 0.8850 level.

There is a potential for USD/CHF to experience declines due to the diminished probability of interest rate hikes by the Federal Reserve.

Additionally, the Swiss Franc might face depreciation as the Swiss National Bank (SNB) has reduced foreign currency reserves to a seven-year low.

After recording modest gains for two consecutive days, USD/CHF is trading in a sideways manner, hovering around 0.8840 during the Asian hours on Friday. The US Dollar (USD) is facing downward pressure as market participants lean towards the possibility of no further interest rate hikes by the Federal Reserve (Fed), which could potentially weaken the USD/CHF pair.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 0.8836 | Positive Crossover | Bullish
  • MA 20: 0.8858| Negative Crossover | Bearish
  • MA 50: 0.8911| Negative Crossover | Bearish

Simple:

  • MA 5: 0.8834 | Positive Crossover | Bullish
  • MA 20: 0.8848| Negative Crossover | Bearish
  • MA 50: 0.8935| Negative Crossover | Bearish

RSI (Relative Strength Index): 36.97| Selling Zone | Bearish

Stochastic Oscillator: 91.06| Buy Zone | Positive

Resistance And Support Levels:

  • R1: 0.8906 | R2: 0.8999
  • S1: 0.8827 | S2: 0.8710

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 0.8789| Take Profit: 0.8710 | Stop Loss: 0.8849.

Elsewhere in the Forex Market

NZD/USD up 0.12% to 0.6055. The USD/CAD down 0.03% to 1.3692. The EUR/GBP down 0.11% at 0.8687. USD/JPY up 0.07% at 149.64, EUR/JPY up 0.07% at 163.12, The USD/CNY up 0.14% at 7.1554, AUD/SEK up 0.15% at 6.8897, at the time of writing.

Key Economic Events & Data Release Today:

(EUR) German GDP (QoQ) (Q3) Actual –0.1%, Forecast –0.1%, Previous 0.0% at 02:00.

(EUR) ECB President Lagarde Speaks at 05:00.

(CAD) Core Retail Sales (MoM) (Sep) Forecast –0.2%, Previous 0.1% at 08:30.

(CAD) Retail Sales (MoM) (Sep) Forecast 0.0%, Previous –0.1% at 08:30.