Daily Forex forecast analysis 10-18-2017 – 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 10-18-2017 include information on EURUSD, USDCHF, GBPUSD, USDJPY & AUDUSD
The euro had been under pressure yesterday as well, but managed to recover some ground in late US session. Today the Catalan government should provide a clear answer and they should clarify if they truly proclaimed independence. Since the decision had been postponed several times, that proves the situation is tense and the market participants are sensing that, thus the euro could be under pressure today also.
Technically speaking, the euro found resistance around 1.1774-1.1781 resistance area and it managed to retreat lower for the last few hours. If the selling pressure will continue, further bearish gains could follow towards 1.1738 and 1.1719.
On the other hand, the buyers will need to overcome the resistance area mentioned above in order to be able to push the price further towards 1.1796 and 1.1817 resistance levels.
- ECB’s Draghi will hold a speech at 08:10am GMT.
- From US, Building Permits and Housing Starts are due at 00:30pm GMT.
The US dollar managed to advance against the swiss franc as well, although solid retracements moves could be seen on the 1h chart. However, the price action made new higher lows and higher highs, which communicates the fact that there is appetite for buying and also, the bulls are still the ones in control. Looking ahead, the Catalonia situation could further support the dollar strength, if the outcome will be bad for the euro.
In terms of the technical situation, so far the price is located around the 1h chart 20 EMA, where we can see it already rebounding. 0.9785 level should be also breached so the price could head again towards the yesterday high.
If the conditions will change and strong selling will start around the 20 EMA, we should see the price reaching the 0.9768 and 0.9855 support. 0.9742 will be our next support area, below the first two.
The inflation from the UK reached the 3% mark yesterday, but due to the fact that not all inflation indicators exceeded expectations + comments from BOE officials who stated that they will not support a rate hike, the cable had been trading on the negative since the release of the figures and there is no sign that the selling wave had ended. Buyers did not manage to generate any substantial move, so we should see further selling.
If that will be the case, 1.3174 support could be breached and if a break below yesterday low will also take place, further selling should drive the price towards 1.3126, where we’ve seen some reaction from the buyers last week, followed by 1.3087.
On the upside, the 1h chart 20 EMA backed by the 1.3199 should form a resistance area and cap the upside, in case the buyers will step in. In case an upside break will take place, further bullish gains could follow towards 1.3221 and 1.3266.
- From UK, Employment figures and Average Earnings are due at 08:30am GMT.
Dollar-yen had a pretty choppy performance yesterday, but still, the price is located above the 4h chart 20 EMA, which shows that the sellers did not have enough power to push the price towards last week lows. We could see renewed buying pressure emerging today, since the sellers did not have a strong response until now. Only a break below the EMA, should weaken the short-term bullish momentum and spark new selling interest.
But, as long as that won’t happen, the buyers should begin to push the price towards yesterday high, 112.49 being located above it. 112.73 is also a resistance area which should be taken into consideration, since we saw some selling activity around it in the past.
On the other hand, if sellers drive the price below the EMA, we should see it heading towards 111.80 and in case a break below the current weekly lows take place, 111.53 will be next to act as support.
The Aussie did not have a clear directional bias yesterday and also today, during the Asian session, but the only detail that seems more important is that the buyers did not manage to generate stronger moves around the 4h chart 20 EMA, which acted as support last week. If the sellers will manage to generate new lower lows and lower highs, the move could continue further, while if the buyers will eventually rebound the price above the EMA, we should see renewed buying pressure emerging.
For the last 16 hours of trading, the price fluctuated in a narrow range and if it will break on the upside, we should see it heading into the 0.7875 key resistance level. Above it, last week high and 0.7906 resistance will follow.
Below the EMA, 0.7834 and the 0.7800 area are expected to act as support, while if a breakout below them will take place, the sellers could attempt the drive the price towards last week lows.