INTRADAY TECHNICAL ANALYSIS 9 SEPTEMBER (observation as of 06:40 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.188549 and 1.18745.

-        Support line of 1.17917 and 1.17721.

Commentary/ Reason:

  1. The euro steadied ahead of a European Central Bank policy meeting later in the day that is expected result in a reduction in stimulus.

  2. The euro bounced from a 1-week low against the dollar and was trading at $1.18234.

  3. All eyes will be on the ECB on Thursday, with market players keen to hear the bank’s outlook on inflation, interest rates and hints on when it might start tapering its massive asset-purchase program despite uncertainty over economic growth and Covid. The ECB announces its latest monetary policy decision at 12:45 p.m. London time and holds a press conference shortly afterward.

  4. If the central bank pauses its tapering plans, traders are likely to sell the currency, possibly pushing the euro towards its support level, while a hawkish central bank would send the currency higher.

  5. The EUR/USD is set to continue oscillating within a tighter trading range between 1.179 and 1.185 price levels.  Bearish sentiment once again prevented a break of the previous resistance line which remains a key obstacle for future rallies.

EURUSD

 

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.92455 and 0.92677.

-        Support line of 0.91737 and 0.91517.

Commentary/ Reason:

  1. A cautious mood saw the safe-haven Swiss franc firming slightly against other major currencies. The franc gained 0.17% to 0.91946 per dollar.

  2. The dollar pared gains following dovish remarks from a Federal Reserve official.

  3. The USD/CHF pair has broken the sideways range and the short-term ascending trendline in an apparent change in sentiment. Price action is now pulled back from the 0.924 resistance line where previous pullbacks have taken place- therefore significant bullish conviction will be required for a break.

USDCHF

 

[GBPUSD]

Important Levels to Watch for:

-        Resistance line of 1.38015 and 1.38267.

-        Support line of 1.37199 and 1.36947.

Commentary/ Reason:

  1. Sterling bounced higher to $1.37742, having slipped at $1.37264, a 1-week low yesterday.

  2. The pound was able to recover after UK policymakers testified before the House of Commons in the Monetary Policy Report Hearings, as they lifted speculation on soon to come tapering in the UK, stating that the minimum conditions for a rate rise have been met.

  3. Meanwhile the U.S. dollar’s safe-haven stature helped the greenback to hold on to its gains despite emerging signs that the U.S. economic growth is being hampered by a resurgence in coronavirus cases as well as other challenges.

  4. The GBP/USD pair provided clear negative trades yesterday and approached 1.371 barrier, to support the chances of achieving more decline in the upcoming sessions, which targets 1.369 mainly.

  5. Meanwhile breaching 1.380 will push the price back to the bullish track again to head higher.

GBPUSD