Intraday Technical Analysis 10 September

USD to open the week on a firm footing

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Daily Forex Market Preview, 10/09/2018

The U.S. dollar posted strong gains on Friday fuelled by strong wage growth and overall positive sentiment for the currency. The official payrolls report for the month of August showed that the U.S. economy added 201,000 jobs during the beat.

This beat estimates of a 191k forecast. The unemployment rate held steady at 3.9% while the average hourly earnings doubled to rise 0.4%, beating estimates of a 0.2% increase.

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On a year over year basis, average earnings rose 2.9% in August.

Canada’s jobs report was also released on Friday. Data showed that the economy shed 51.6k jobs during August with the unemployment rate rising to 6.0%.

Elsewhere, volatility spiked in the British pound once again on Brexit headlines but the cable soon eased back to give up its gains.

Earlier today, Japan released its final quarterly GDP figures. As expected, there were no revisions with the economy rising 0.7% in the second quarter. The data comes ahead of the BoJ’s meeting due the week after.

China’s inflation figures were also released. Data showed that headline CPI rose 2.3% beating estimates of a 2.1% increase. Producer prices jumped 4.1%, in line with estimates but slower than 4.6% from the month before.

Later in the day, the UK’s monthly GDP report will be released. Economists forecast a 0.2% increase on the month for August. The data is followed by industrial, manufacturing and construction output.

The NY trading session is relatively quiet for the day.

EURUSD intraday analysis

eurusd

EURUSD (1.1539): The EURUSD extended declines on Friday as price action is seen testing the 1.1540 level of support. With the ECB’s monetary policy meeting due later this week, the currency pair could ease back and settle into a range ahead of Thursday’s big ticket event. The support at 1.1540 will be crucial as a break down below this level could send the common currency down to 1.1418 support. To the upside, the resistance area of 1.16656 – 1.1626 will need to be breached to post further gains.

GBPUSD intraday analysis

gbpusd

GBPUSD (1.2911): The British pound continues to remain volatile with the currency pair reacting to any report on Brexit talks. After rising to session highs of 1.3028, the currency pair fell back towards Friday’s close. We continue to watch the potential head and shoulders pattern that is evolving. A continued decline to 1.2808 neckline support and a break down below this level will trigger further selling. This could push the cable down to 1.2682 as the measured downside target.

XAUUSD intraday analysis

xauusd

XAUUSD (1192.94): Gold was trading flat on Friday. Despite the previous attempt to break above 1197.50 the precious metal gradually gave up the gains. The 20-period EMA on the 4-hour chart is flat indicating the sideways price action. However, the daily chart is signaling a potential bearish flag pattern. With the recent bounce failing to test new highs, the precious metal could be seen heading lower. Watch for the retest of support at 1183.30 region in the short term.

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