USDCHF bounces higher
The US dollar finds support from an increase in producer prices in July. The pair has been looking to hold onto its gains after a jump above 0.8700, turning the latter into a tested support level. The upper band of the horizontal consolidation at 0.8800 coincides with the 30-day SMA, making it a strong cap to the greenback’s advance. However, a bullish breakout would pave the way for an extended recovery to 0.8900. On the downside, a fall below 0.8700 would indicate weak buying interest and send the pair to 0.8600.
EURGBP hits resistance
The pound rallied after the GDP showed a surprise uptick in the second quarter. A jump above the previous high of 0.8650 shows buyers’ interest in keeping the euro’s edge after it spent three weeks in consolidation. 0.8680 right under the July peak would be the last obstacle and its breach may put the euro back on the rebound trajectory in the next few days. In the meantime, the pair needs to consolidate its gains above the major floor of 0.8590 to keep the upward impetus intact. 0.8640 is a fresh hurdle to lift in case of a bounce.
GER 40 struggles for support
The Dax 40 retreats as stubborn global prices dampen markets’ enthusiasm. The index is trying to bottom out with a bullish RSI divergence indicating a slowdown in the sell-off momentum. Even though buying has reemerged around 15720 with an attempt above the psychological tag of 16000, reclaiming the swing high of 16050 is imperative to attract those who are still on the sidelines. Otherwise, a drop below 15720 would signal lingering weakness and the bears may double down and send the index to July’s low of 15000.
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