Forex Trading Library

Intraday Market Analysis – USD in consolidation mode

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AUDUSD consolidates

The Australian dollar steadied after the RBA minutes hinted at a slowdown in hikes. A lack of support for the recent rebound is a sign that the bulls struggle to hold onto their gains. A drop below the daily support at 0.6680 may have prompted the last buyers to bail out and resumed the downtrend in the medium-term. 0.6600 from May 2020 is an intermediate support and its breach could extend losses towards 0.6510. On the upside, trend followers could be expected to sell into strength in the former demand zone at 0.6760.

EURJPY seeks support

The Japanese yen strengthened after August’s CPI beat expectations. The pair is looking to consolidate its recent gains after rising through June’s highs at 144.20. A bearish RSI divergence suggested a deceleration in the momentum, then a break below 142.70 triggered some profit-taking. However, from the daily chart’s perspective, the directional bias remains up. 141.40 at the origin of this month’s bullish breakout coincides with the 20-day moving average, making it a congestion area. A close above 144.50 could resume the rally.

US 30 tests critical support

The Dow Jones 30 recoups losses ahead of the Fed’s policy meeting tomorrow. A bearish MA cross on the daily chart shows an acceleration to the downside and a break below 31000 has certainly put the bulls on the defensive. Last July’s low at 30200 is a critical floor and its breach may expose the index to a sharp sell-off towards 29000, confirming a bear market for the weeks to come. An oversold RSI attracted some bargain hunters. The support-turned-resistance at 31500 is the first hurdle in case of a bounce.

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