Intraday Market Analysis – Dax nears inflection point
USDCHF bounces back
The US dollar rose after stronger-than-expected consumer spending in September. Its retreat came to a halt at 0.9840 near the 30-day moving average. A bullish RSI divergence showed a deceleration on the way down. Such an indication in a demand zone carries significance. With overall sentiment still pointing to the upside, the bulls’ may have been eager to load on the pullback. A close above the previous supply area (0.9950) could attract more buying interests. The rally may resume should the greenback reclaim 1.0050.
EURJPY edges higher
The Japanese yen continues to struggle as the BOJ maintains its yield cap. A sharp fallback has given the euro some respite after it pushed past September’s high at 145.50, now a fresh support. 143.80 at the base of a previous breakout so far has proved to be a solid support, suggesting strong interest in keeping the yen in check. The current consolidation may have only shaken out weaker hands. The bulls might have the last word if they manage to lift 147.70. A runaway rally would send the single currency towards 150.00.
GER 40 tests key resistance
The Dax 40 rallied after data showed the German economy avoided a contraction in Q3. The index has been climbing a rising trendline, a sign of risk appetite in the short-term. After a series of higher lows, a close above 13100 further cemented the upward bias and may attract more followers. The start of the September sell-off (13500) is a major obstacle, where profit-taking and fresh selling could be expected. However, its breach could extend the reversal in the weeks to come. 13050 next to the trendline is the first support.