Daily Forex Market Preview, 21/09/2016
The Japanese yen was seen trading volatile into the BoJ’s decision today, briefly falling to 101.00 before pushing higher. Price action is expected to be volatile as the FOMC and RBNZ policy decisions are due later in the day. The US dollar is seen trading stronger on the back of the BoJ event, but that could change depending on the Fed’s decision.
EURUSD Daily Analysis
EURUSD (1.1132): EURUSD attempted to test the 1.1200 handle for two days with prices failing to break away above the resistance level. At the time of writing, EURUSD is seen plunging with 1.1100 support now likely to be tested for support. On the 4-hour chart, EURUSD could remain stuck near 1.1150 support level ahead of further declines to the lower support zone at 1.1100. A potential break below 1.1100 could signal further downside which could see EURUSD test 1.1000 support.
USDJPY Daily Analysis
USDJPY (102.46): USDJPY managed to briefly push lower to 101.00 handle before breaking out higher. Still, the price action remains inconclusive for now as any gains are likely to be muted into the FOMC meeting. Watch the 4-hour chart for a potential close above 102.00, in which case USDJPY could stay range bound within 103.00 resistance. Further upside can be seen only above 103.00 in which case USDJPY has the potential to test the 105.00 handle. To the downside, the brief rejection near 101.00 poses a risk of a stronger retest of this support.
GBPUSD Daily Analysis
GBPUSD (1.2959): GBPUSD was bearish yesterday continuing its declines from last Friday. Prices broke down below the 1.3000 handle with further declines likely to push the cable down to 1.2800. On the 4-hour chart, the steep decline could see the risks of a short squeeze as the stochatsics could point to a possible correction if prices close above 1.3000. Resistance is seen at 1.3067, while the longer term resistance at 1.3170 - 1.3200 remains further to the upside.
Gold Daily Analysis
XAUUSD (1311.85): Gold prices have been trading in small ranges for the past three days which could indicate a strong momentum led the breakout, most likely today. Gold prices remain support above 1310 - 1300 handle which could be tested today, provided the support at 1312 - 1314 gives way. Watch for further continuation of the declines from September 7th. A breakdown below 1300.00 could, however, spell further weakness in the precious metal which could see the next support level at 1280 - 1275 being tested.