. Daily FX Analysis - GBP/USD Plummets, EUR/USD Battles, USD/CAD Faces Showdown, USD/CHF Hovers.

Daily FX Analysis – GBP/USD Plummets, EUR/USD Battles, USD/CAD Faces Showdown, USD/CHF Hovers.

Daily FX Analysis – GBP/USD Plummets, EUR/USD Battles, USD/CAD Faces Showdown, USD/CHF Hovers.

17 Nov 2023

Introduction:

GBP/USD is declining towards 1.2350 following disappointing UK Retail Sales data. In early European trading, the pair faces downward pressure amid a cautious market mood. Meanwhile, EUR/USD is slipping below 1.0850 as the US dollar gains demand, and USD/CAD loses ground around mid-1.3700s. USD/CHF consolidates near 0.8880 ahead of Swiss Industrial Production data. Investors are awaiting key economic indicators, including US housing data and Swiss Industrial Production.

GBP/USD:

GBP/USD declines toward 1.2350 after downbeat UK Retail Sales data.

In the initial stages of European trading on Friday, the GBP/USD pair is continuing its decline, reaching the 1.2350 mark. The Pound Sterling is facing downward pressure due to discouraging UK Retail Sales data, while the US Dollar is stabilizing amidst a market atmosphere marked by caution. The upcoming focus is on the US housing data.

On Thursday, GBP/USD entered a consolidation phase near the 1.2400 level, following a significant downward correction experienced on Wednesday.

The market anticipates the Federal Reserve to commence a reduction in the policy rate during the latter part of 2024, prompted by the October Consumer Price Index (CPI) data, which fell below expectations.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.2408 | Negative Crossover | Bearish
  • MA 20: 1.2361 | Positive Crossover | Bullish
  • MA 50: 1.2296 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.2410 | Negative Crossover | Bearish
  • MA 20: 1.2337 | Positive Crossover | Bullish
  • MA 50: 1.2262| Positive Crossover | Bullish

RSI (Relative Strength Index): 57.36| Buy Zone | Bullish

Stochastic Oscillator: 41.95| Neutral Zone | Negative

Resistance And Support Levels:

  • R1: 1.2404| R2: 1.2563
  • S1: 1.2267| S2: 1.2120

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.2458 | Take Profit: 1.2563 | Stop Loss: 1.2396

EUR/USD:

EUR/USD shifts back below 1.0850 as US dollar finds demand.

On Friday, the EUR/USD fluctuates within a tight trading range cantered around the mid-1.0800s.

In the European morning on Friday, EUR/USD is slipping below the 1.0850 level. Despite sluggish US Treasury bond yields, the US Dollar is gaining support from a cautious risk sentiment, putting downward pressure on the currency pair.

On the daily chart, the EUR/USD is maintaining a horizontal trajectory within the range of 1.0830 to 1.0890, securing its recent advances and remaining positioned above crucial Simple Moving Averages (SMAs).

Investors are eagerly awaiting a speech from ECB President Lagarde and mid-tier economic data from both the EU and the US.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.0847| Negative Crossover | Bearish
  • MA 20: 1.0787| Positive Crossover | Bullish
  • MA 50: 1.0714 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.0852 | Negative Crossover | Bearish
  • MA 20: 1.0768 | Positive Crossover | Bullish
  • MA 50: 1.0684 | Positive Crossover | Bullish

RSI (Relative Strength Index): 63.31| Buy Zone | Bullish

Stochastic Oscillator: 55.77| Buy zone | Negative

Resistance And Support Levels:

  • R1: 1.8754| R2: 1.0955
  • S1: 1.0778| S2: 1.0686

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.0879| Take Profit: 1.0955 | Stop Loss: 1.0833

USD/CAD:

USD/CAD loses ground around the mid-1.3700s as US housing data looms.

On Friday, there is selling interest in USD/CAD around the mid-1.3700s. The US weekly Initial Claims increased by 231,000, reaching the highest level in nearly three months. In Canada, house sales experienced the most significant decline in 16 months during October.

The USD/CAD pair experiences a slowdown in momentum in the Asian session on Friday. It is down by 0.1% for the day, currently trading at 1.3749. This marks a consolidation phase following the rebound from the weekly low of 1.3655 observed on Wednesday.

Market participants will closely monitor the upcoming US housing data and the Canadian Industrial Product Price Index, as well as the Raw Materials Price Index.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.3738 | Positive Crossover | Bullish
  • MA 20: 1.3746| Positive Crossover | Bullish
  • MA 50: 1.3749 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.3733 | Positive Crossover | Bullish
  • MA 20: 1.3761 | Negative Crossover | Bearish
  • MA 50: 1.3778| Negative Crossover | Bearish

RSI (Relative Strength Index): 49.98| Buying Zone| Bullish

Stochastic Oscillator: 62.17 |Buying Zone | Positive

Resistance And Support Levels:

  • R1: 1.3757| R2: 1.3851
  • S1: 1.3679 | S2: 1.3582

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.3783 | Take Profit: 1.3851 | Stop Loss: 1.3740

USD/CHF:

USD/CHF consolidates near 0.8880 ahead of Swiss Industrial Production.

USD/CHF encountered difficulties due to worries about China’s property sector. The Swiss Franc may strengthen amid the prevailing risk-off sentiment. Positive US jobless claims data appear insufficient to bolster the resilience of the US Dollar.

In the Asian session on Friday, USD/CHF is in the vicinity of 0.8880. Moreover, the Swiss National Bank (SNB) has affirmed its commitment to safeguard the CHF through direct market purchases, further weighing on the USD/CHF pair.

Investors are probably anticipating crucial economic indicators, such as Swiss Industrial Production and US housing data scheduled for release on Friday.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 0.8885 | Negative Crossover | Bearish
  • MA 20: 0.8934| Negative Crossover | Bearish
  • MA 50: 0.8972| Negative Crossover | Bearish

Simple:

  • MA 5: 0.8882 | Positive Crossover | Bullish
  • MA 20: 0.8954| Negative Crossover | Bearish
  • MA 50: 0.8993| Negative Crossover | Bearish

RSI (Relative Strength Index): 32.79| Selling Zone | Bearish

Stochastic Oscillator: 18.06| Sell Zone | Neutral

Resistance And Support Levels:

  • R1: 0.8962 | R2: 0.9080
  • S1: 0.8871 | S2: 0.8765

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 0.8835| Take Profit: 0.8765 | Stop Loss: 0.8891.

Elsewhere in the Forex Market

NZD/USD down 0.31% to 0.5951. The AUD/USD up 0.07% to 1.3693. The EUR/GBP up 0.01% at 0.8742. USD/JPY down 0.24% at 150.36, EUR/JPY down 0.44% at 162.83, The USD/CNY up 0.07% at 7.2470, AUD/SEK down 0.01% at 6.8514, at the time of writing.

 Key Economic Events & Data Release Today:

(GBP) Retail Sales (MoM) (Oct) Actual –0.3%, Forecast 0.3%, Previous –0.9% at 02:00.

(EUR) ECB President Lagarde Speaks at 14:00.

(EUR) CPI (YoY) (Oct) Forecast 2.9%, Previous 4.3% at 05:00.

(USD) Building Permits (Oct) Forecast 1.450M, Previous 1.471M at 08:30.