NZDUSD tests major support
The US dollar holds onto recent gains as PMI data show the US as the most resilient economies. The long drift lower is a sign of profit-taking from the previous surge and the pair is now testing the demand zone around 0.6140 at the base of the July breakout rally. This is an important area to maintain the rebound bias or a breakout would expose the daily swing low 0.6050. The RSI’s oversold condition may trigger a buy-the-dips behaviour but the bulls will need to lift 0.6250 first to start to ease the downward pressure.
EURGBP seeks support
The euro slipped after the PMIs showed a larger-than-expected contraction in the euro zone. The price is consolidating its gains after clearing the daily resistance of 0.8650 and a bullish MA cross on the daily chart could attract some buying interests. The resistance-turned-support and the round number of 0.8600 is the next level to see if the buy side manages to regain control. Otherwise, a deeper retracement may send the pair to 0.8550. On the upside, a revisit above the immediate hurdle of 0.8660 would resume the climb.
US 30 tests ceiling
The Dow Jones remains steady as investors brace for the Fed’s rate decision on Wednesday. The rally has been unobstructed after it cleared the cluster of resistance around 34500. As the index is reaching a 15-month high at 35500, an overbought RSI on the daily chart and the indicator’s bearish divergence shows a slowdown in the current momentum and could foreshadow a pullback. A drop below the psychological level of 35000 would offer confirmation. But a rebound would mean ‘business as usual’ for trend followers.
