Daily Forex forecast analysis 10-17-2017 – we analyzed the upcoming currency pairs and events of the day that could impact the Forex market, These analysis are published here each day.
Forex Forecast Analysis 10-17-2017 include information on EURUSD, USDCHF, GBPUSD, USDJPY & AUDUSD
The euro had been under pressure since the beginning of the week, since the uncertainty continues to be high around the Catalonia independence. Even though yesterday it was the last day in which Catalonia officials should have clarified if they proclaimed independence. That did not happened and the next deadline will be Thursday. Since uncertainty will be high, we expect the euro to continue to be under pressure until the announcement.
So far, the price managed to break below the 1.1788 support and it seems like further continuation towards 1.1756 will take place soon. A strong breakout below that area could open more selling ground towards 1.1715.
On the upside, we expect the price action to continue to trade below the 20 EMA, 1.1788 resistance being also located around the EMA. 1.1804 could further cap the upside, in case a brief break above the MA will take place.
- From EU, very important CPI figures are due at 10:00am GMT.
- From US, Industrial Production and Capacity Utilization will follow at 01:15pm GMT.
The dollar managed to recover against the swiss franc as well, following the Friday slump that was generated by weak US inflation figures. So far, the price managed to break above the 0.9768 resistance, which communicates that sellers are not in control of the order flow anymore and further bullish gains might follow in the short-term. Only a strong breakout below the 1h chart 20 EMA could negate that assumption.
Since a breach above the 0.9768 will take place, even though the price retraces lower, we expect the level to act as support now and if the price action will continue to fluctuate above it, we could see further gains towards 0.9785 and 0.9800.
On the other hand, if the 0.9768 will fade and sellers will manage to push the price below it, the EMA will be the next support zone, while below it, we should see further selling towards the 0.9742 support.
Sterling had also been under pressure against the US dollar, since uncertainty is high around the Brexit negotiations. However, today we have some key inflation data due to being released from the UK, which could influence heavily the order flow. The analysts expect an increase to 3%, which could spark speculation that the BOE could raise interest rates even at the next meeting. If the expectations won’t be met, further selling will follow.
If the first scenario will take place, bulls will start to push the price up impulsively and we expect the price to reach the 1.3287 and 1.3314 resistance levels, the lather being the one that capped the upside last week.
On the other hand, if inflation figures will come below expectations, selling pressure will continue and we expect the price to reach 1.3200 area and possibly, 1.3174, where some bullish reaction might be seen.
- From UK, PPI figures, Retail Price Index figures and CPI figures will come out at 08:30am GMT.
The US dollar managed to recover some ground against the yen, but so far, the bearish parabolic structure is still in play. Looking at the overall picture, compared to the bullish move you can see on the right of the chart, sellers did not manage to have a strong impact on price, which shows, that they are still finding it difficult to push the price lower, so buying activity could resume at any time, if we do not see a stronger bearish response from the sellers.
At the time of writing, the price action is located little above the 4h chart 20 EMA, which we did not see for more than a week. That suggests the selling pressure weakened short-term and if the buyers will treat the EMA as support, further gains could follow towards 112.49 and 112.72 swing point, where sellers could resume.
On the downside, a strong break below the EMA will be needed to confirm the sellers resumed impulsively and that could signal a move towards the weekly lows and a potential break lower could follow.
The Aussie had retreated lower, even though a breakout above the 0.7875 key resistance area took place at the end of last week. The price action broke below the area yesterday and since that point, we can see that the sellers managed to push the price lower towards the 4h chart 20 EMA. At the time of writing, some bullish activity can be seen around the EMA, since the downside was capped and we expect to see how the market participants will react in the near future.
If buyers will manage to build up around the EMA, 0.7860 and 0.7875 key level could be reached again. A break above last week high will send the price towards our next resistance located around the 0.7906 area.
If the selling pressure will continue and a break below current daily low will take place, further downside gains could follow towards the 0.7811 and 0.7795 could follow then.