INTRADAY TECHNICAL ANALYSIS 4 AUGUST (observation as of 05:30 UTC)
[EURUSD]
Important Levels to Watch for:
- Resistance line of 1.18972 and 1.19130.
- Support line of 1.18460 and 1.18302.
Commentary/ Reason:
The euro was a touch higher at $1.18727 per dollar on Wednesday, as traders awaited U.S. jobs data for a guide to the rates outlook.
The pair was broadly steady as markets looked ahead to partial U.S. labour data due later today and non-farm payroll figures due on Friday.
Clouding the outlook further is the spread of COVID-19 Delta variant. The 7-day average of daily coronavirus cases in the U.S. surpassed the peak seen last summer, a time before COVID-19 vaccine approved.
The EUR/USD continues to float along the 1.184 and 1.189 price levels, as neither buyers nor sellers appear to have the appetite to drive price action. The current range of price levels will likely float sideways and a change in price action will be facilitated by a change in fundamental factors.
[USDCHF]
Important Levels to Watch for:
- Resistance line of 0.90630 and 0.90787.
- Support line of 0.90124 and 0.89967.
Commentary/ Reason:
The safe-haven Swiss franc has been on the front foot against the U.S. dollar. It hit a 7-week high of 0.90223 per dollar overnight, and last traded at 0.90344 on Wednesday.
The Swiss franc benefited from the dollar's softness, particularly as nerves about the spread of the Delta coronavirus variant keep a degree of caution in currency markets prompted traders to wind back bets on a strong economic recovery.
The greenback remained sideways as traders waited for more economic data releases this week, especially the labour data on Friday. The USD/CHF is accumulating on the downside, approached 0.9000 barrier support level target, and breaking the level represents the key to head towards 0.899 as a next negative station.
[GBPUSD]
Important Levels to Watch for:
- Resistance line of 1.39482 and 1.39703.
- Support line of 1.38765 and 1.38543.
Commentary/ Reason:
The British pound gains 0.10% on Wednesday to $1.39280.
Sterling has found momentum from an encouraging end to COVID-19 restrictions in the England, which has so far seemed not to cause a spike in virus deaths.
Attention there now turns to a Bank of England meeting on Thursday, with focus on policymakers economic projections and on what they say that means for rates. The BoE is expected to keep its benchmark interest rate and its bond-buying target unchanged.
The GBP/USD pair will make another attempt around the 1.394 price level after a recent pullback. The price level represents the upper bound of a recent trading range and a break would indicate significant bullish conviction.
