From a technical perspective, the corrective slide dragged the pair towards an important confluence resistance breakpoint, now turned support near the 1.1790-85 region. Any subsequent weakness is more likely to find decent support near the 1.1765-60 horizontal zone. Failure to defend the latter might negate any near-term bullish bias and turn the pair vulnerable to accelerate the fall back towards the 1.1700 mark. The downward trajectory could further get extended towards testing September monthly swing lows, around the 1.1615-10 region. On the flip side, attempted positive moves might now confront a stiff resistance near the 1.1855-60 region. The mentioned barrier marks the 61.8% Fibonacci level of the 1.2011-1.1612 downfall. A sustained move beyond the 1.1880-90 congestion zone will be seen as a fresh trigger for bullish traders and set the stage for an extension of the recent appreciating move, possibly towards reclaiming the key 1.2000 psychological mark.
GBP/USD is on a steady decline so far this Friday but holds above the 1.3050 level, as the US dollar remains broadly underpinned following the conclusion of the final Presidential election debate. The spot extends its retreat from six-week highs of 1.3178 into a second day, mainly pressured by the resurgent demand for the US dollar across its main peers. Despite some signs of progress in the US fiscal stimulus talks, the greenback drew bids on the back of upbeat US jobless claims and existing home sales data. Meanwhile, rising coronavirus cases globally kept the investors on the edge, benefiting the safe-haven dollar.
The US Dollar failed to continue higher above 105.75 and started a fresh decline against the Japanese Yen. USD/JPY broke the key 105.00 support zone to move into a bearish zone. t traded as low as 104.24 before starting an upside correction. There was a break above the 104.60 level, plus the 23.6% Fib retracement level of the recent decline from the 105.75 high to 104.24 swing low. However, the pair is facing a strong resistance near the 105.00 zone. The 50% Fib retracement level of the recent decline from the 105.75 high to 104.24 swing low is also near the 105.05 level. The next major resistance is near the 105.40 level since it is close to the 100 simple moving average (4-hours) and the 200 simple moving average (4-hours). A clear break above 105.00 and then a follow up move above 105.40 is needed for a fresh increase. If not, there is a risk of more losses below 104.20 and 104.00 in the near term. The next major support below 104.00 could be near 103.50.
EUR/JPY remains under pressure following its recent failure at the 200-week ma at 125.21 and our bias remains negative below 125.30. “The pair is starting to erode the five-month uptrend at 123.47 and we target 122.38, the September low and there is scope for the 200-day ma at 121.13. Only a break above here and Fibonacci resistance at 125.29 would initiate a re-challenge of the 2014-2020 resistance line at 126.93, which we again would allow to hold.”
As we can see in the H4 chart, the correctional downtrend in AUD/USD hasn’t reached 23.6% fibo at 0.6962 after a divergence on MACD. At the moment, there are signs in favor of new consolidation. Right now, both scenarios (bullish – a growth towards the high at 0.7414, and bearish – further decline to reach 23.6% and 38.2% fibo at 0.6962 and 0.6685 respectively) are equally possible. In the case of the first scenario, the instrument may break the high at 0.7414 and then reach the long-term 76.0% fibo at 0.7504.
As we can see in the H4 chart, USD/CAD is moving upwards after a convergence on MACD and has already reached 23.6% fibo. The main scenario implies further growth with the targets at 38.2%, 50.0%, 61.8%, and 76.0% fibo at 1.3210, 1.3250, 1.3291, and 1.3338 respectively. However, an alternative scenario says that the asset may break the low at 1.1.3081 and then continue falling towards the fractal low at 1.2994. The H1 chart shows that the pair has reached 23.6% fibo and may start a new pullback. After the pullback, the asset may resume growing towards 38.2% and 50.0% fibo at 1.3210 and 1.3220 respectively, or even higher.
Crude oil prices are hovering just below range resistance in the 42.40-43.88 area. A downswing from here sees initial support in the 34.64-36.15 zone, with a break below that likely exposing the 27.40-30.73 region next. Alternatively, a daily close above resistance may open the door for a test of the $50/bbl figure.
From a technical point of view, spot gold remains on the downside as it has failed to break through the key resistance as shown on the daily chart. It has retreated after getting near a declining trend line drawn from August and is also capped by the 50-day moving average. The level at $1,935 may be considered as the nearest resistance, while the 1st and 2nd support are expected to be located at $1,872 and $1,848 respectively.
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