After a steady winning streak on the economic data, the U.S. home sales report released yesterday showed that the pending home sales fell in November. Pending home sales were down 2.5% on a month over month basis, missing forecasts of a 0.6% increase and erased the 0.1% increase seen in October. While the buck managed to maintain its gains rising to session highs of 103.57, the gains were short lived as prices eased back from the intraday highs. At the timeof writing, the U.S. dollar index is seen trending lower but price action still remains range bound.
EURUSD Intra-day Analysis
EURUSD (1.0459): EURUSD slipped back to the 1.0400 support handle yesterday posting an intraday low at 1.0371 before pulling back higher to close above 1.0400. This dip marks the formation of the right shoulder as we currently see EURUSD attempting to breakout from the neckline resistance level of 1.0472 – 1.0463. A breakout above this resistance will signal a continuation to the upside towards 1.0533 with the potential to reach out towards 1.0600. However, in the longer term trend, EURUSD remains biased to the downside and any rallies are likely to be met with more sellers entering the market.
GBPUSD Intra-day Analysis
USDJPY Intra-day Analysis
USDJPY (116.35): USDJPY is seen pushing lower as price approaches the 116.00 handle. The strong consolidation could see further downside on a confirmed close below 116.00. The next main support is seen at 114.00 which could hold the declines for the near term. The 4-hour chart shows that price action is likely to move at a gradual pace especially with the Stochastics nearing the oversold level. This potentially raises the risk of a retracement back towards the 117.00 handle. Still, the bias in USDJPY remains to the downside with 114.00 being the initial support level of interest. A break down below 114.00 will see further declines extending towards 109.75 support.
