European forex blog

NEWS: GBP 4:30 AM est Manufacturing Production m/m

Trade Balance

AUD 5:30 AM est Annual Budget Release

CAD 8:30 AM est Trade Balance

USD 8:30 AM est Trade Balance

NZD 5:00 PM est RBNZ Financial Stability Report

EUR/USD retraced from last week’s big rally and had a slight selloff back to the previous monthly high which is now testing as support for the lows of the day. Price is still well above the 20/50 and 200 day MA’s so watch for potential support at the next fib retracement clusters

beginning at 1.3512 and 1.3468. IF the momentum continues with the current monthly rally, the next possible resistance may be at the next fib targets of 1.3796 (fib target, weekly pivot and whole number) then at 1.3873.

GBP/USD double topped at last week’s high and sold off to the next key 62% retracement for the lows of the day on light volatility. If price continues to retrace from the recent runup and sells off on Tuesday, the next fib retracement levels for possible support will be 1.4924 and 1.4828. IF price does continue with long rally, 1.5250 is this week’s and last week’s high where price bounced and may be resistance if tested again. The next potential resistance is 1.5367 as the next fib target and weekly pivot.

USD/JPY did manage to break through major support from the 20/50 and 200 day MA’s which were clustered together just below before Monday. Even with the light reversal of most of the USD based pairs as the USD gained strength, the usd/jpy still sold off. IF price does continue to sell off, the next fib cluster begins at 96.35 and then stronger potential support from (95.80-95.60)! IF price rallies, watch for a chance to enter the sell off at the key fib retracement levels 98.19, 98.42 and 98.70.

USD/CHF had a very low volume day and rallied slightly after the huge sell off on late Friday trading session. IF price continues to rally, the resistance clusters for possible resistance are (1.1220-1.1243) and 1.1268. IF USD again gains strength and the CHF weakens look for the downtrend to obviously continue. 1.0928 and 1.0869 are fib targets and weekly pivots and may offer light support but use caution if the FXPI or FXMM’s are at their extremes.

USD/CAD completely reversed from Friday’s sell off as a weak CAD helped to rally price and may test the highs of last Thursday/Friday now for resistance. IF price does continue to rally, the next possible resistance is 1.1762 (weekly pivot and last major highest swing point). 1.1870 is a fairly strong fib retracement cluster from multiple swings where price may also stall. IF price continuest to sell off, last week’s lows near the 1.1500 level may again be support if tested, then 1.1366 is the next fib target for lighter potential support.

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