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Intraday Analysis – USD makes comeback

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NZDUSD turns south

The US dollar soars as the Fed is yet to signal the end of its tightening cycle. A series of higher lows from 0.5860 indicated growing pressure from those who bought at the 10-month low. But after hitting resistance at 0.5985 near the base of a sell-off in early September the kiwi fell through the immediate support of 0.5930, denting the momentum and turning 0.5950 into a resistance. 0.5890 at a previous consolidation is the next support level and further down, a drop back below 0.5860 could trigger a new round of sell-off.

EURGBP tests key resistance

The pound fell after both CPI and retail sales data came out below expectations last month. The latest surge has put the August high of 0.8670 within reach. A break above this major obstacle would flush out the remaining bears and pave the way for a broader bounce to 0.8800 in the medium-term. As the RSI retreats into the neutral area, 0.8610 at the origin of the momentum is the first level to gauge the strength of follow-up interests. A failure to hold would expose the swing low of 0.8570 next to the moving averages.

NAS 100 to revisit daily support

The Nasdaq 100 plunged after the Fed hawkishly hinted at a further rate increase by the end of the year. The index has struggled to secure a footing over 15070 near the base of a momentum rally at the end of August and a limited sideways action failed to clear 15260. A subsequent bearish breakout shows that the path of least resistance is down, invalidating the September rally and forcing more bulls out of the game. The demand zone 14700-14800 could be their last chance to prevent a bearish reversal on the daily chart.

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