Daily Forex forecast analysis 10-25-2017 – 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 10-25-2017 include information on EURUSD, USDCHF, GBPUSD, USDJPY & AUDUSD
The euro had consolidated below the 4h chart 20 EMA and the price action that formed from the start of the week suggests that the market participants are still not eager to buy the euro, due to political uncertainty in Spain. We can also see a bearish pin bar that formed in late US session, which also could be taken as a selling signal. Looking ahead, we expect the euro to continue to weaken further against the US dollar.
That should be the case, if the price will continue to trade below the EMA and we think there could be further selling towards 1.1735 and 1.1719, where the price rebounded this week. A break lower will expose 1.1698 support.
On the upside, the bulls will need to break above the EMA in order to put under pressure yesterday high, where short-term resistance is expected. 1.1804 should follow above, so we expect the upside to be limited.
- Three IFO indicators for Germany are due at 08:00 am GMT.
- From US, Durable Goods Orders figures, New Home Sales and Housing Price Index will follow at 00:30 pm and 02:00pm, respectively.
The 0.9837 level acted as support following the bullish breakout and it managed to support the trend since we can see the price managed to extend higher yesterday. So far, it encountered some short-term resistance around the 0.9905 level, but looking at the price action prior to that, we can see that the bulls are heavily in control and further bullish gains could follow in the near future as long as optimism around the US will continue.
If the 0.9905 will manage to generate enough selling pressure, a retracement lower could build up towards 0.9880 and 0.9862, where the 4h chart 20 EMA is also located. The price had been supported by the EMA for a while so buyers might resume there.
If the bulls will resume and break impulsively above the 0.9905 resistance, then a continuation towards 0.9939-0.9953 resistance area seems very likely.
- From Switzerland, Zew Survey – Expectations is due at 08:00 am GMT.
Cable was under pressure yesterday, after new comments from BOE officials suggested a rate hike is still under question. Following the news, sterling weakened against all majors and it should continue to do that as long as the economic data won’t support a rate hike. Most likely, the BOE expects more confirmation and the economic development until the next meeting will play a major key.
Getting back to cable, so far the price managed to find some short-term support around 1.3134 area, but the buying activity is still very mild. Key GDP figures are due in a few hours, so if the data will disappoint, further selling towards 1.3090 or 1.3044 will follow.
If the sterling will be support by positive data, a rebound will begin and we expect the price to head into the 4h chart 20 EMA and also, 1.3183 located above it.
- From UK, GDP figures + BBA Mortgage Approvals and Index of Services are due at 08:30 am GMT.
Dollar-yen managed to find support around the 113.30 area and rebounded higher yesterday, only to be capped by our 113.89 resistance in late US session. Looking at the price action structure, we are still above the 20 EMA, which suggests the selling pressure is not too strong thus far. Also, we have to mention that the price is approaching a critical resistance area, located around 114.30 area, where we expect stronger selling activity.
Until that point, the buyers still have to push the price higher and they should encounter resistance around the 113.89 again and 114.08, current weekly high. The upside should be limited above that level.
On the downside, the EMA should act as support and if it fails to do that, further selling could drive the price towards 113.43 and 113.25 level. That is where the bulls rebounded yesterday and they could do the same again.
The Aussie weakened strongly today, during the Asian session after weaker CPI figures where published in Australia. The price action managed to break below the 0.7732 support level and given the fact it managed to overcome that weekly low, it communicates the sellers are still in control long-term. Looking ahead, we expect to see if the sellers will manage to keep the upside limited below the support, in case a breach above will happen, bulls should gain some ground.
So far, we do not see any significant bullish reaction, but if that will take place, 0.7732 should act as resistance and 0.7747 could further cap the upside. If the bulls resume impulsively, a continuation towards the 20 EMA is not excluded.
If the selling pressure will continue to extend, 0.7711 and 0.7680 could be next targets, but now on it will depend on the US data if the dollar will continue to appreciate further.