INTRADAY TECHNICAL ANALYSIS 30 AUGUST (observation as of 06:45 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.18063 and 1.18320.

-        Support line of 1.17227 and 1.16970.

Commentary/ Reason:

  1. The euro touched its highest since early August on Monday, and last traded at $1.18014.

  2. U.S. dollar nursed losses after Fed Chairman laid out a slower-than-expected path to rate hikes. Powell appeared on Friday to strike a more dovish tone than many other officials, refraining from providing a clearer picture regarding the timing of tapering or interest rate hikes.

  3. Dollar weakness since Friday boosted the euro along with signs of price pressures in Germany that hawkish for ECB policy.

  4. From a technical perspective, acceptance above the 1.180-mark favours bullish traders and supports prospects for a move towards the 1.183 horizontal resistance. Some follow-through buying will set the stage for additional gains.

  5. On the flip side, the 1.1722 region now seems to protect the immediate downside. Failure to defend the mentioned support levels will negate any near-term positive bias and prompt some technical selling. The pair might then turn vulnerable to break below the 1.169 mark and slide further towards challenging monthly swing lows, around the 1.1665 region touched on August 20.

EURUSD

 

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.91761 and 0.92006.

-        Support line of 0.90969 and 0.90724.

Commentary/ Reason:

  1. The dollar rose 0.10% against the Swiss franc on Monday, although still loitered around its 2-week lows on Monday in the wake of Federal Reserve Chair Jerome Powell laying out a slower-than-expected path to rate hikes.

  2. The dollar now held at 0.91178 franc.

  3. Traders’ focus now shifted to U.S. jobs figures due on Friday for clues on a tapering timeline

  4. The USDCHF pair bounced downwards strongly after testing 0.920 level, to reach around the 0.910 now, noticing that the price moves within sideways track between the mentioned levels, making the sideways bias suggested on the intraday basis until the price manages to breach one of the mentioned levels.

  5. Breaking the current support will press on the price to achieve additional decline that targets 0.9096 followed by 0.9072 levels, while breaching 0.9176 resistance will push the price back to the 0.9200.

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 $1.37622, little moved from opening today, traded just below Friday’s 1-week high. The greenback has fallen since Powell said on Friday that tapering could begin this year but that it wouldn’t directly signal higher rates, as hiking would need the economy to pass a substantially more stringent test.

  2. A holiday in Britain on Monday was expected to limit further moves in the London session today.

  3. Worries about the fast-spreading Delta variant in the UK capped gains for the pound, as the UK government does not plan new measures to counter the spread, although the risk-on impulse undermined the safe-haven dollar and exerted support to the pair.

  4. Intraday bias in GBP/USD remains neutral first, with focus on 1.378 resistance, which proved to be hard to break in the past trade. Break there will turn bias to the 1.381 resistance.

GBPUSD