INTRADAY TECHNICAL ANALYSIS 27 AUGUST (observation as of 05:30 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.17878 and 1.18071.

-        Support line of 1.17254 and 1.17061.

Commentary/ Reason:

  1. The euro traded at $1.17632, having eased from the previous day’s high of $1.1788.

  2. A weaker consumer sentiment survey in Germany weighted on the euro performance. The survey showing German consumer sentiment darkened heading into September due to accelerating inflation and rising COVID-19 cases.

  3. Losses in pair however were limited after the 10-year German bund yield rose to a 1-month of -0.402%, which improved the euro’s interest rate differentials, while the T-note yields fell back from their highs on Thursday.

  4. The EUR/USD pair bounced bearishly after testing 1.178 level in the previous sessions, to resume the bearish track, waiting for more decline to test 1.1725 as a first station, which breaking it represents the key to rally towards 1.170 as a next target.

  5. A sustained move over 1.178 will indicate the presence of buyers. If this move creates enough upside momentum, it then is possibly extending into 1.180.

  6. On Friday, investors will watch Federal Reserve Chair Jerome Powell speak to the annual Jackson Hole economic conference, but few expect hints about when the U.S. central bank may start reducing asset purchases.

EURUSD

 

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.92061 and 0.92302.

-        Support line of 0.91279 and 0.91038.

Commentary/ Reason:

  1. The dollar slipped 0.13% against the Swiss franc on Friday, traded at 0.91643 franc, retreated from yesterday’s 1-week high.

  2. The dollar was weighted as investors repositioned themselves ahead of the U.S. Federal Reserve’s Jackson Hole Economic Policy Symposium, an annual platform where the central bank could signal its monetary policy stance. Easing tapering fears continued weighing on the dollar and capped the upside for the major.

  3. The USD/CHF pair begins today positively to move higher, before faces good resistance. A bears would seek the next target at the 0.912 and 0.910 support levels.

  4. On the other hand, a sustained move above the psychological 0.920 mark, would extend the upside movement at the 0.923 horizontal resistance level.

USDCHF

 

[GBPUSD]

Important Levels to Watch for:

-        Resistance line of 1.37684 and 1.37993.

-        Support line of 1.36683 and 1.36373.

Commentary/ Reason:

  1. Sterling held at $1.37010, little moved from opening today following yesterday’s drop from a 1-week high.

  2. Worries about the fast-spreading Delta variant in the UK capped gains for the pound, although the risk-on impulse undermined the safe-haven dollar and exerted some support to the pair.

  3. Investors also seemed reluctant ahead of Powell’s speech at Jackson Hole Symposium. Tensions also are mounting toward Fed Chair Jerome Powell's speech in the virtual Jackson Hole Symposium. While he is expected to refrain from hinting at tapering the bank's bond purchase program, such a move could come sooner than later. Signals that Fed officials viewed a taper this year most likely will helped buoy the dollar.

  4. Support awaits at 1.366, around a double-bottom from this week, and then by 1.363.

  5. Some resistance is at the daily high of 1.376, followed by 1.379.

GBPUSD