The dollar was mixed against its G10 counterparts during the European morning Tuesday as the US government shutdown continued with no signs of progress. The pound managed to gain against the greenback overnight on a higher-than-expected RICS house price index, but the dollar regained ground this morning ahead of tomorrow’s Bank of England monetary policy decision for October. Not far behind, JPY was the second biggest loser against the dollar after Japan’s current account surplus for August unexpectedly plunged, missing expectations (JPY 162bn NSA vs JPY 520bn NSA exp.). The Euro was virtually unchanged despite a surprising drop in German factory orders in August. I think, these currencies seems to be talking a small rest from their uptrends as it is possible that some investors are securing their short-profits. On the other hand, NOK and SEK were the biggest winners during the European morning despite the absence of market-affecting news for the currencies. The afternoon’s economic calendar does not include any major news except the Canadian housing starts, which are forecast to rise in September to an annualized pace of 185.0K from a 180.2K in August, but that has to be seen in the context of a yesterday’s announcement of a steep fall in building permits in August. In the US, the NFIB small business optimism index for September is expected to remain unchanged at 94.0 USD/CAD moved higher after finding support at the 38.2% Fibonacci retracement level of the 19th Sept. - 02 Oct. upward move. During the European morning the pair manage to violate the resistance line of a symmetrical triangle formation (light blue lines). Nonetheless, I would wait for a clear upward break of the well-tested barrier at 1.0339 (R1) in order to confirm the validity of the escape. A victory of the longs at that level should target the 161.8% Fibonacci extension level of the triangle’s width, at 1.0405 (4-hour chart). Short term studies support further upside movement, since they follow an upward path as indicated by their blue support lines. Support: 1.0314 (S1), 1.0289 (S2), 1.0268 (S3) Resistance: 1.0339 (R1), 1.0355 (R2), 1.0378 (R3) gyazo/06ad49b46c7b1e00d7e6e2851fd9bfcf
Posted on: Tue, 08 Oct 2013 11:33:09 +0000
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