. Daily FX Analysis - EUR/USD, GBP/USD rise amid USD weakness.

Daily FX Analysis – EUR/USD, GBP/USD rise amid USD weakness.

Daily FX Analysis – EUR/USD, GBP/USD rise amid USD weakness.

11 Jan 2024

Introduction

In the dynamic forex market, EUR/USD is consolidating below 1.1000 in early Europe amid a risk-on market mood, finding support as the US Dollar faces challenges. The pair climbed to two-day highs on Wednesday, with the USD weakening against firm risk sentiment. GBP/USD eyes 1.2800, benefiting from a weaker USD. AUD/USD holds above 0.6700, while NZD/USD retraces losses despite downbeat Kiwi Building Permits, with a focus on upcoming US CPI data.

Markets In Focus Today – EUR/USD

EUR/USD consolidates gains below 1.1000 ahead of US CPI data.

EUR/USD is consolidating gains below 1.10000 in early Europe on Thursday. The pair receives support as the US Dollar faces challenges due to a risk-on market mood ahead of the critical US Consumer Price Index (CPI) data release. EUR/USD regained balance and climbed to the area of two-day highs in the 1.0965/70 band in tandem with firm optimism in the risk space on Wednesday. The renewed downside bias in the greenback kept the USD Index (DXY) under pressure and forced it to recede to the 102.30 region, once again amidst the absence of direction in US yields, an uptick in Germany’s 10-year bund yields, and the prevailing risk-on sentiment among market participants.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.10 | Positive Crossover | Bullish
  • MA 20 : 1.10 | Positive Crossover | Bullish
  • MA 50 : 1.09 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.10 | Positive Crossover | Bullish
  • MA 20 : 1.10 | Negative Crossover | Bearish
  • MA 50 : 1.09 | Positive Crossover | Bullish

RSI (Relative Strength Index): 54.41 | Buy Zone | Bullish

Stochastic   Oscillator : 32.10 | Sell Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.11 R2 : 1.12
  • S1 : 1.08 S2 : 1.07

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 1.0973 | Take Profit: 1.1069 | Stop Loss: 1.0923

GBP/USD

GBP/USD stays directed toward 1.2800, with eyes on US inflation data.

GBP/USD is extending gains toward 1.2800 in the early European trading hours on Thursday. A broadly weaker US Dollar and risk flows are helping the pair gain ground. Traders await the December US Consumer Price Index data for fresh impetus. GBP/USD edged lower and snapped a 4-day winning streak on Tuesday, pressured by the negative shift seen in risk sentiment. The pair holds steady above 1.2700 early Wednesday but the technical outlook doesn’t yet point to a build-up of recovery momentum. The US Dollar (USD) gathered strength on Tuesday as safe-haven flows dominated the action in financial markets in the American session. Investors are concerned that a prolonged conflict in the Middle East could ramp up energy prices and make it difficult for central banks to tame inflation.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.27 | Positive Crossover | Bullish
  • MA 20 : 1.27 | Positive Crossover | Bullish
  • MA 50 : 1.26 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.27 | Positive Crossover | Bullish
  • MA 20 : 1.27 | Positive Crossover | Bullish
  • MA 50 : 1.26 | Positive Crossover | Bullish

RSI (Relative Strength Index): 58.44 | Buy Zone | Bullish

Stochastic   Oscillator : 58.68 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.28 R2 : 1.29
  • S1 : 1.26 S2 : 1.25

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 1.2721 | Take Profit: 1.2825 | Stop Loss: 1.2667

AUD/USD

AUD/USD holds higher ground above 0.6700, focus stays on US CPI.

AUD/USD is holding higher ground above the 0.6700 mark, despite mixed Australian trade figures. The pair is benefitting from the ongoing weakness in the US Dollar even though markets stay cautious ahead of the crucial US CPI data. In line with the broad-based positive sentiment in the risk-associated space, AUD/USD clocked a decent advance on Wednesday, this time managing to reclaim, albeit briefly, the area north of 0.6700 the figure. Speaking about inflation, consumer prices in Australia rose less than initially estimated by 4.3% in the year to November, the slowest rate since January 2022 when tracked by the RBA’s Monthly CPI Indicator.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.67 | Negative Crossover | Bearish
  • MA 20 : 0.67 | Negative Crossover | Bearish
  • MA 50 : 0.66 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.67 | Negative Crossover | Bearish
  • MA 20 : 0.68 | Negative Crossover | Bearish
  • MA 50 : 0.66 | Positive Crossover | Bullish

RSI (Relative Strength Index): 52.20 | Buy Zone | Bullish

Stochastic   Oscillator : 26.19 | Sell Zone | Neutral

Resistance   And Support Levels :

  • R1 : 0.69 R2 : 0.69
  • S1 : 0.66 S2 : 0.65

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 0.6687 | Take Profit: 0.6781 | Stop Loss: 0.6631

NZD/USD

NZD/USD improves to near 0.6240 despite downbeat Kiwi Building Permits, US CPI data eyed.

NZD/USD retraces its recent losses on risk-on market mood. New Zealand’s Building Permits MoM fell by 10.6% versus the previous increase of 8.5%. Downbeat US Treasury yields contributed to undermining the US Dollar. NZD/USD snaps a two-day losing streak on Thursday, improving to near 0.6240 during the Asian session. The New Zealand Dollar (NZD) moves on an upward trajectory despite a leading housing market indicator showing a decline in the number of permits for new construction projects in the country. Additionally, traders are displaying an enhanced risk appetite, speculating on the likelihood of five rate cuts in 2024.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.63 | Negative Crossover | Bearish
  • MA 20 : 0.62 | Positive Crossover | Bullish
  • MA 50 : 0.62 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.63 | Negative Crossover | Bearish
  • MA 20 : 0.63 | Negative Crossover | Bearish
  • MA 50 : 0.61 | Positive Crossover | Bullish

RSI (Relative Strength Index): 54.90 | Buy Zone | Bullish

Stochastic   Oscillator : 29.90 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 0.64 R2 : 0.64
  • S1 : 0.61 S2 : 0.61

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 0.6237 | Take Profit: 0.6322 | Stop Loss: 0.6186

Elsewhere In The Forex Market

EUR/GBP down 0.12% to 0.8600. The NZD/USD up 0.4% to 0.6251. The USD/CAD is down 0.14% at 1.3361. USD/JPY down 0.22% at 145.43. EUR/JPY is down 0.15% at 159.69, The USD/CNY is down 0.16% at 7.1595, and AUD/SEK is up 0.11% at 6.8584, at the time of writing.

Key Economic Events & Data Release Today:

(USD) Initial Jobless Claims Forecast 210K, Previous 202K at 19:00. (USD) CPI (MoM) (Dec) Forecast 0.2%, Previous 0.1% at 19:00. (USD) CPI (MoM) (Dec) Forecast 0.2%, Previous 0.1% at 19:00.