. Daily FX Analysis - EUR/USD Struggles, GBP/USD Rebounds, USD/CHF Falters, NZD/USD Surges.

Daily FX Analysis – EUR/USD Struggles, GBP/USD Rebounds, USD/CHF Falters, NZD/USD Surges.

Daily FX Analysis – EUR/USD Struggles, GBP/USD Rebounds, USD/CHF Falters, NZD/USD Surges.

24 Jan 2024

Introduction

EUR/USD hovers below 1.0900 following Germany’s PMI data revealing continued economic contraction, hindering Euro’s recovery. Meanwhile, GBP/USD sees improvement near 1.2700 after a sharp Tuesday reversal. USD/CHF, ending its winning streak, trades below 0.8700 amid subdued US Dollar and Fed rate cut speculations. NZD/USD extends gains to 0.6110, benefiting from a weaker USD and in anticipation of US PMI data, following New Zealand’s CPI release. Investors await the ECB’s monetary policy and US GDP data before making significant moves.

Markets In Focus Today – EUR/USD

EUR/USD stays below 1.0900 after the German PMI data.

EUR/USD continues fluctuating in a narrow channel below 1.0900 on Wednesday. The data from Germany showed that the private sector’s economic activity continued to contract in early January, not allowing the Euro to gather recovery momentum. EUR/USD turned south and touched its lowest level since mid-December at 1.0820 during the American trading hours on Tuesday. Although the pair managed to recover above 1.0850 early Wednesday, the technical outlook is yet to point to a build-up of bullish momentum. Nevertheless, investors are likely to refrain from taking large positions ahead of the European Central Bank’s (ECB) monetary policy announcements on Thursday.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.09 | Negative Crossover | Bearish
  • MA 20 : 1.09 | Negative Crossover | Bearish
  • MA 50 : 1.09 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.09 | Negative Crossover | Bearish
  • MA 20 : 1.09 | Negative Crossover | Bearish
  • MA 50 : 1.09 | Negative Crossover | Bearish

RSI (Relative Strength Index): 43.09 | Neutral Zone | Neutral

Stochastic   Oscillator : 22.06 | Sell Zone | Negative

Resistance   And Support Levels :

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

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion: Stop Sell: 1.0851 | Take Profit: 1.0749 | Stop Loss: 1.0918

GBP/USD

GBP/USD improves to near 1.2700 followed by the monthly high.

GBP/USD recovers its recent gains, trading higher near 1.2690 during the early European hours on Wednesday. The psychological level at 1.2700 appears as the immediate resistance followed by the weekly high 1.2747 aligned with the major barrier at 1.2750. After rising toward 1.2750 early Tuesday, GBP/USD made a sharp U-turn and lost nearly 100 pips during the American trading hours. The improving risk mood toward the end of the day, however, helped the pair erase a large portion of its daily losses. Early Wednesday, GBP/USD holds steady at around 1.2700. Investors, however, could opt to wait to see the fourth-quarter US Gross Domestic Product (GDP) on Thursday before taking large positions.

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 : 1.27 | Positive Crossover | Bullish

RSI (Relative Strength Index): 53.39 | Buy Zone | Bullish

Stochastic   Oscillator : 56.61 | Buy Zone | Negative

Resistance   And Support Levels :

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

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Stop Buy: 1.2733 | Take Profit: 1.2827 | Stop Loss: 1.2678

USD/CHF

USD/CHF halts its winning streak on a subdued US Dollar and moves below 0.8700.

USD/CHF strives to snap its winning streak as US Treasury yields decline. Markets bets on Fed rate cuts in March have slowed down. Fed’s Bullard has anticipated the central bank to initiate policy rate cuts as early as March. USD/CHF makes an effort to halt its winning streak that began on January 11. The USD/CHF pair traded lower near 0.8690 during the Asian session on Wednesday. This could be attributed to a minor decline in the US Dollar due to the downbeat US Treasury yields.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.86 | Positive Crossover | Bullish
  • MA 20 : 0.86 | Positive Crossover | Bullish
  • MA 50 : 0.87 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.86 | Positive Crossover | Bullish
  • MA 20 : 0.86 | Positive Crossover | Bullish
  • MA 50 : 0.87 | Positive Crossover | Bullish

RSI (Relative Strength Index): 58.64 | Neutral Zone | Neutral

Stochastic   Oscillator : 87.71 | Neutral Zone | Neutral

Resistance   And Support Levels :

  • R1 : 0.87 R2 : 0.88
  • S1 : 0.83 S2 : 0.82

Overall Sentiment: Neutral Market Direction: Buy

Trade Suggestion: Stop Buy: 0.8693 | Take Profit: 0.8822 | Stop Loss: 0.8618

NZD/USD

NZD/USD extends its gains to near 0.6110 ahead of US PMI data.

NZD/USD gains ground as US Dollar loses ground on lower US bond yields. Kiwi CPI YoY came above the RBNZ’s target 1-3% target range at 4.7% in Q4.In February’s meeting, the market expects no adjustment in the Fed’s monetary policy. NZD/USD capitalizes on its intraday gains as the US Dollar (USD) declines after recording profits in the previous two sessions. The NZD/USD pair trades around the 0.6110 during the early European hours on Wednesday. Furthermore, the Consumer Price Index (CPI) data for the New Zealand Dollar (Kiwi), released on Wednesday, showed a year-over-year figure of 4.7% in the fourth quarter, aligning with expectations. However, this marked a decrease from the previous reading of 5.6%.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.61 | Positive Crossover | Bullish
  • MA 20 : 0.62 | Negative Crossover | Bearish
  • MA 50 : 0.62 | Negative Crossover | Bearish

Simple :

  • MA 10 : 0.61 | Positive Crossover | Bullish
  • MA 20 : 0.62 | Negative Crossover | Bearish
  • MA 50 : 0.62 | Negative Crossover | Bearish

RSI (Relative Strength Index): 40.56 | Neutral Zone | Neutral

Stochastic   Oscillator : 100 | Buy Zone | Positive

Resistance   And Support Levels :

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

Overall Sentiment: Neutral Market Direction: Buy

Trade Suggestion: Limit Buy: 0.6099 | Take Profit: 0.6183 | Stop Loss: 0.6050

Elsewhere In The Forex Market

EUR/GBP down 0.03% to 0.8551. The AUD/USD up 0.53% to 0.6604. The USD/CAD is down 0.09% at 1.3450. USD/JPY down 0.49% at 147.56. EUR/JPY is down 0.37% at 160.42, USD/CNY is down 0.06% at 7.1675, and AUD/SEK is down 0.20% at 6.8862, at the time of writing.

Key Economic Events & Data Release Today:

(NZD) CPI (QoQ) (Q4) Actual 0.5%, Forecast 0.5%, Previous 1.8% at 03:15. (EUR) German Manufacturing PMI (Jan) Actual 45.4, Forecast 43.7, Previous 43.3 at 14:00. (CAD) BoC Interest Rate Decision Forecast 5.00%, Previous 5.00% at 20:15. (USD) Manufacturing PMI (Jan) Forecast 47.9, Previous 47.9 at 20:15. (CAD) BoC Monetary Policy Report at 20:30. (CAD) BoC Press Conference at 21:30.