. Daily FX Analysis - EUR/USD, GBP/USD, USD/CAD, USD/CHF trends.

Daily FX Analysis – EUR/USD, GBP/USD, USD/CAD, USD/CHF trends.

Daily FX Analysis – EUR/USD, GBP/USD, USD/CAD, USD/CHF trends.

06 Feb 2024

Introduction

EUR/USD holds onto recovery gains near 1.0750, buoyed by positive German data, while the USD retreats from its recent multi-week high. In contrast, GBP/USD rebounds toward 1.2600 amid an overall weakened US Dollar. USD/CAD snaps a two-day winning streak above 1.3500, facing resistance ahead of Canadian PMI data. USD/CHF maintains below 0.8700 as the Swiss Franc potentially benefits from an improved 10-year Swiss bond yield, following Federal Reserve Chair Jerome Powell’s dismissal of a March rate cut.

Markets In Focus Today – EUR/USD

EUR/USD clings to recovery gains near 1.0750 on upbeat German data.

EUR/USD trades in positive territory near 1.0750 in the European session on Tuesday as the USD retreats from the multi-week high it set on Monday. The data from Germany showed that Factory Orders rose 2.7% in December, supporting the Euro. In two consecutive sessions, EUR/USD broke below the key 200-day SMA (1.0836) and the provisional 100-day SMA (1.0783), reaching levels last seen in early December near 1.0720 on Monday. On the opposite side of the equation, the USD Index (DXY) saw its upside bias strongly reinvigorated as investors kept assessing another firm monthly job creation, as per Friday’s Nonfarm Payrolls (+353K), along with hawkish remarks from Chief Powell at his interview on CBS released over the weekend.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0815 | Negative Crossover | Bearish
  • MA 20 : 1.0852 | Negative Crossover | Bearish
  • MA 50 : 1.0868 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.0823 | Negative Crossover | Bearish
  • MA 20 : 1.0867 | Negative Crossover | Bearish
  • MA 50 : 1.0902 | Negative Crossover | Bearish

RSI (Relative Strength Index): 37.0641 | Sell Zone | Bearish

Stochastic   Oscillator : 9.8014 | Sell Zone | Negative

Resistance   And Support Levels :

  • R1 : 1.0982 R2 : 1.1041
  • S1 : 1.0790 S2 : 1.0731

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion: Limit Sell: 1.0779 | Take Profit: 1.0719 | Stop Loss: 1.0825

GBP/USD

GBP/USD rebounds toward 1.2600 amid US Dollar retreat.

GBP/USD is extending the recovery toward 1.2600 in the European session on Tuesday. Improving risk sentiment outweighs fading expectations of early Fed rate cuts, keeping the US Dollar broadly undermined. Traders await Fedspeak for fresh impetus. The GBP/USD tumbles in the mid-North American session trade with losses of 0.74% and exchanges hands at 1.2535. Factors like last Friday’s US economic data and over-the-weekend comments of Federal Reserve Chair Jerome Powell keep the US Dollar bid amid a risk-off impulse. US Treasury yields remain high during the day and underpin the Greenback as investors re-calibrate their bets for Fed rate cuts.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2645 | Negative Crossover | Bearish
  • MA 20 : 1.2668 | Negative Crossover | Bearish
  • MA 50 : 1.2639 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.2669 | Negative Crossover | Bearish
  • MA 20 : 1.2688 | Negative Crossover | Bearish
  • MA 50 : 1.2676 | Negative Crossover | Bearish

RSI (Relative Strength Index): 38.4953 | Sell Zone | Bearish

Stochastic   Oscillator : 13.2681 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 1.2763 R2 : 1.2807
  • S1 : 1.2618 S2 : 1.2574

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion: Limit Sell: 1.2589 | Take Profit: 1.2511 | Stop Loss: 1.2644

USD/CAD

USD/CAD Snaps two-day winning streak above the 1.3500 mark.

USD/CAD recovery loses steam near 1.3510 ahead of the Canadian PMI data. The pair resumes its uptrend above the key EMA; the RSI indicator is above the 50.0 midlines. The first upside target is seen at 1.3545; the initial support level is located at 1.3460. The USD/CAD pair loses traction near the intraday low during the early European trading hours on Tuesday. The decline of the US Dollar (USD) acts as a headwind for the pair. Later on Tuesday, the Canadian Ivey Purchasing Managers Index (PMI) for January will be due, which is estimated to ease to 55.0 in January from 56.3 in December. At press time, USD/CAD is trading at 1.3510, down 0.22% on the day.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.3464 | Positive Crossover | Bullish
  • MA 20 : 1.3445 | Positive Crossover | Bullish
  • MA 50 : 1.3457 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.3458 | Positive Crossover | Bullish
  • MA 20 : 1.3451 | Positive Crossover | Bullish
  • MA 50 : 1.3422 | Positive Crossover | Bullish

RSI (Relative Strength Index): 56.8199 | Buy Zone | Bullish

Stochastic   Oscillator : 79.2808 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 1.3521 R2 : 1.3595
  • S1 : 1.3282 S2 : 1.3208

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Stop Buy: 1.3526 | Take Profit: 1.3606 | Stop Loss: 1.3477

USD/CHF

USD/CHF maintains its position below 0.8700 amid a softer US Dollar.

USD/CHF takes a breather after two days of a winning streak. The Swiss Franc could receive support from the improved 10-year Swiss bond yield Dollar made profits on Fed Powell’s rejection of the rate cut in March amid upbeat economic data. USD/CHF trades lower after registering gains for consecutive two days, edging lower to near 0.8700 during the Asian session on Tuesday. The Swiss Franc (CHF) may be receiving support from the improved 10-year Swiss bond yield, standing at 0.93% by the press time. This movement in the bond yield could be influenced by global market sentiment after the recent comments from Federal Reserve Chair Jerome Powell, who indicated that a rate cut in March is premature.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.8651 | Positive Crossover | Bullish
  • MA 20 : 0.8630 | Positive Crossover | Bullish
  • MA 50 : 0.8656 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.8642 | Positive Crossover | Bullish
  • MA 20 : 0.8626 | Positive Crossover | Bullish
  • MA 50 : 0.8617 | Positive Crossover | Bullish

RSI (Relative Strength Index): 59.0465 | Buy Zone | Bullish

Stochastic   Oscillator : 78.4867 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 0.8706 R2 : 0.8784
  • S1 : 0.8452 S2 : 0.8374

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 0.8686 | Take Profit: 0.8780 | Stop Loss: 0.8638

Elsewhere In The Forex Market

EUR/GBP down 0.04% to 0.8565. The NZD/USD up 0.3% to 0.6071. The AUD/USD up 0.45% at 0.6512. USD/JPY down 0.09% at 148.54. USD/CHF was down 0.49% at 0.6533, The USD/CNY was down 0.08% at 7.1922, and the AUD/SEK was up 0.23% at 6.8897, at the time of writing.

Key Economic Events & Data Release Today:

(CAD) Ivey PMI (Jan) Forecast 55.0, Previous 56.3 at 10:00. (CAD) Building Permits (MoM) (Dec) Forecast 1.8%, Previous –3.9% at 08:30. (NZD) Employment Change (QoQ) (Q4) Forecast 0.3%, Previous –0.2% at 16:45.