INTRADAY TECHNICAL ANALYSIS 29 JULY (observation as of 05:30 UTC)


Important Levels to Watch for:

-        Resistance line of 1.18705 and 1.19005.

-        Support line of 1.17735 and 1.17435.

Commentary/ Reason:

  1. The euro up at $1.18551 on Thursday. The post-FOMC USD selloff allowed EUR/USD to rally. The follow-through momentum pushed the pair to over 2-week tops.

  2. The euro bounced after slumped initially following the confidence of U.S. economy by the Fed. The dollar then retreated after the Chairman Powell remarked that rate increases were "a ways away" and that the job market still had "some ground to cover".

  3. Signs of increasing price pressures in the Eurozone are hawkish for ECB policy and positive for the euro after the German Jun import price index rose stronger than expectations and the biggest increase in 39-1/2 years.

  4. Ahead on Thursday traders await German labour and inflation data, European sentiment surveys and Q2 U.S. GDP - where forecasts vary wildly but the consensus is for 8.5% annualised growth. This, along with the US bond yields, will drive the greenback and might produce some meaningful trading opportunities around the major.

  5. The EUR/USD pair had a rather volatile trading action, with price move was mostly by the U.S. dollar price dynamics.




Important Levels to Watch for:

-        Resistance line of 0.91656 and 0.91946.

-        Support line of 0.91721 and 0.90432.

Commentary/ Reason:

  1. The franc traded higher against the U.S. dollar on Thursday after no changes were made to the US monetary policy. This means that the Fed is likely to continue to print money to support the U.S. economy and the dollar could resume its downward movement against its counterparts.

  2. The Swiss franc rose to more than a month against the dollar, to trade at 0.90901.

  3. USD/CHF is accumulating on the downside following the Federal Reserve's dovish tilt during the press conference which weighed on the greenback. The USD/CHF pair broke 0.9135 consolidation level to fall under more expected negative pressure for the upcoming period, on its way to visit 0.907 followed by 0.904 levels as next main targets.




Important Levels to Watch for:

-        Resistance line of 1.39299 and 1.39570.

-        Support line of 1.38421 and 1.38150.

Commentary/ Reason:

  1. Sterling is up 0.30% on Thursday to trade at $1.39360, rose to more than 1-month high.

  2. Sterling has been riding higher with re-opening optimism. Traders have been encouraged by early signs that England's end to most COVID restrictions last week has not been a disaster.

  3. While British infection numbers ticked higher on Wednesday, but the rolling averages are heading lower - though experts, and Prime Minister Boris Johnson, have cautioned that it is too early to draw conclusions.

  4. Intraday bias is back on the upside for retesting 1.3957 high next. On the downside, below 1.3842 minor support will turn intraday bias neutral and bring retreat first, before possibly staging another rally.