. Weekly FX Analysis -GBP/USD Resists, EUR/USD Advances, AUD/USD Gains Momentum, USD/JPY Drops.

Weekly FX Analysis -GBP/USD Resists, EUR/USD Advances, AUD/USD Gains Momentum, USD/JPY Drops.

Weekly FX Analysis -GBP/USD Resists, EUR/USD Advances, AUD/USD Gains Momentum, USD/JPY Drops.

18 Nov 2023

Introduction:

In the world of currency markets, here’s a snapshot of recent developments for some key currency pairs. The GBP/USD struggles to surpass 1.2450 amid a turbulent trading week, while the EUR/USD inches towards 1.0900 on a risk-on sentiment. AUD/USD sees significant gains above 0.6500, eyeing weekly increases. USD/JPY dips below 150.00 despite positive US housing data, emphasizing BoJ’s patience in monetary policy.

GBP/USD:

GBP/USD pair is finding it difficult to rise over 1. 2450, Despite broad-market risk-on bids.

On Friday, the GBP/USD is maintaining a steady yet turbulent trading pattern, making efforts to stay above the 1.2450 level. The midweek surge in the Pound Sterling is at risk, with market participants trimming back on the previously acquired gains.

The GBP/USD is hovering slightly above the 1.2450 mark, navigating the upper range of its recent consolidation. The Pound Sterling (GBP) is facing challenges in retaining the advances it made against the US Dollar (USD) throughout the week.

In the upcoming week, investors will shift their focus to the release of the latest Meeting Minutes from the Federal Reserve on Tuesday.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.2406 | Positive Crossover | Bullish
  • MA 20: 1.2302 | Positive Crossover | Bullish
  • MA 50: 1.2317 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.2412 | Positive Crossover | Bullish
  • MA 20: 1.2261| Positive Crossover | Bullish
  • MA 50: 1.2254 | Positive Crossover | Bullish

RSI (Relative Strength Index): 62.03 | Buy Zone | Bullish

Stochastic Oscillator: 75.11 | Buying Zone | Neutral

Resistance And Support Levels:

  • R1: 1.2468 | R2: 1.2650
  • S1: 1.2323 | S2: 1.2192

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.2500 | Take Profit: 1.2650 | Stop Loss: 1.2412

EUR/USD:

EUR/USD tests 1.0900 heading into the Friday closing bell.

In Friday’s trading session, the EUR/USD is gradually ascending, reaching around 1.0900. Investor sentiment is leaning towards risk-on as they reinforce their positions, speculating that the Federal Reserve has concluded its cycle of interest rate hikes.

Late on Friday, the EUR/USD reached the 1.0900 level, concluding a trading week that commenced with an early rally to the 1.0880 area, propelled by the week’s opening bids near 1.0680.

Market participants are preparing to delve into the Meeting Minutes from the Federal Reserve scheduled for release next Tuesday.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1.0839 | Positive Crossover | Bullish
  • MA 20: 1.0718 | Positive Crossover | Bullish
  • MA 50: 1.0691 | Positive Crossover | Bullish

Simple:

  • MA 5: 1.0836 | Positive Crossover | Bullish
  • MA 20: 1.0685 | Positive Crossover | Bullish
  • MA 50: 1.0632 | Positive Crossover | Bullish

RSI (Relative Strength Index): 69.83| Buy Zone | Bullish

Stochastic Oscillator: 89.78 | Buy Zone | Positive

Resistance And Support Levels:

  • R1: 1.0922 | R2: 1.1032
  • S1: 1.0824 | S2: 1.0729

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1.0948 | Take Profit: 1.1032 | Stop Loss: 1.0896

AUD/USD:

AUD/USD rises above 0.6500, eyeing weekly gains amid soft US data.

The AUD/USD observed a significant increase, surging by 0.67% during the New York session and on track for a weekly gain exceeding 2.30%.

In the latter part of the New York session, the AUD/USD registers an increase of 0.66%, poised to record weekly gains exceeding 2.30%. The currency pair is trading above the 0.6500 level, reflecting daily gains of 0.67%.

In the approaching week, the US is set to unveil significant data releases such as Existing Home Sales, FOMC minutes, and PMIs. Meanwhile, Australia’s schedule will highlight speeches from RBA Governor Michele Bullock and the release of the latest RBA meeting minutes.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 0.6477| Positive Crossover | Bullish
  • MA 20: 0.6423 | Positive Crossover | Bullish
  • MA 50: 0.6420 | Positive Crossover | Bullish

Simple:

  • MA 5: 0.6474 | Positive Crossover | Bullish
  • MA 20: 0.6405 | Positive Crossover | Bullish
  • MA 50: 0.6395 | Positive Crossover | Bullish

RSI (Relative Strength Index): 60.23| Buying zone| Bullish

Stochastic Oscillator: 71.35 | Buy Zone | Positive

Resistance And Support Levels:

  • R1: 0.6519 | R2: 0.6633
  • S1: 0.6429 | S2: 0.6349

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 0.6544 | Take Profit: 0.6633 | Stop Loss: 0.6485

USD/JPY:

USD/JPY dips below 150.00, on sentiment shift, despite positive US housing data.

The USD/JPY has dropped beneath the critical 150.00 level, currently at 149.76, reflecting a 0.64% decline amid a change in market sentiment. Bank of Japan Governor Kazuo Ueda underscores the importance of exercising patience in monetary policy, connecting potential policy adjustments to sustainable inflation targets and a favourable wage-inflation cycle.

In the mid-North American session on Friday, the USD/JPY fell below the 150.00 level as a decline in market sentiment ensued, attributed to the expiration of derivative instruments tied to stocks.

Regarding Japan, the most recent data provided support for the Bank of Japan’s (BoJ) accommodative stance, as the GDP contracted in Q3, interrupting two consecutive quarters of growth.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 150.51 | Negative Crossover | Bearish
  • MA 20: 150.40 | Negative Crossover | Bearish
  • MA 50: 149.17 | Positive Crossover | Bullish

Simple:

  • MA 5: 150.75 | Negative Crossover | Bearish
  • MA 20: 150.46 | Negative Crossover | Bearish
  • MA 50: 149.43 | Positive Crossover | Bullish

RSI (Relative Strength Index): 44.78| Neutral Zone | Neutral

Stochastic Oscillator: 23.82| Sell zone | Negative

Resistance And Support Levels:

  • R1: 150.64 | R2: 151.80
  • S1: 149.40 | S2: 146.37

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell 148.31| Take Profit: 146.37 | Stop Loss: 149.86

Elsewhere in the Forex Market

NZD/USD up 0.33% to 0.5989. The EUR/JPY down 0.2% to 163.21. The USDCHF down 0.48% at 0.8844. USD/CAD down 0.25% at 1.3721, EUR/GBP up 0.05% at 0.8745. The USD/CNY down 0.42% at 7.2119, AUD/SEK up 0.02% at 6.8535, CHF/SGD up 0.07% at 1.5170 at the time of writing.

Key Economic Events & Data Release for Upcoming Week:

(GBP) BoE Gov Bailey Speaks (Tuesday).

(AUD) RBA Meeting Minutes (Tuesday).

(CAD) Core CPI (MoM) (Oct) (Tuesday)

(USD) Existing Home Sales (Tuesday).

(USD) FOMC Meeting Minutes (Wednesday).

(USD) Initial Jobless Claims (Wednesday).

(USD) FOMC Meeting Minutes (Thursday)

(EUR) German Manufacturing PMI (Nov) (Thursday).

(GBP) Manufacturing PMI (Thursday).

(EUR) German GDP (QOQ) (Q3) (Friday)

(EUR) ECB President Lagarde Speaks (Friday)