Important Levels to Watch for:

-        Resistance line of 1.00462 and 1.00921.

-        Support line of 0.98975 and 0.98515.

Commentary/ Reason:

  1. The euro rose 0.42% to $0.99884, though still stayed below parity and was not far from last week's 20-year low of $0.99007.

  2. The euro was headed for its third weekly loss in a row against the dollar, headed for about 0.20% weekly losses.

  3. Following the hot inflation data from the Eurozone on Wednesday, the shared currency struggled to gather strength, but hawkish ECB bets allowed EUR/USD to push higher. Eurozone money markets currently price in an 80% chance of a 75-bps ECB rate hike next week, compared to just over 50% earlier in the week.

  4. Record-high inflation in the Eurozone in August pushed European government bond yields higher, strengthening the euro’s interest rate differentials and pushing EUR/USD higher.

  5. The EUR/USD pair is on the expectations of continuing the bearish trend on the intraday and short-term basis, waiting to visit 0.9897 as a next main target, and breaking this level will push the price to 0.9851.

  6. Bearish trend will be suggested for the upcoming period conditioned by the price stability below 1.0046, being aware during today’s trading, especially at the time of releasing the U.S. labour data, which might cause high volatility at the markets, a data that could bolster the case for interest rate hikes.




Important Levels to Watch for:

-        Resistance line of 0.98187 and 0.98494.

-        Support line of 0.97193 and 0.96886.

Commentary/ Reason:

  1. The dollar eased against the Swiss franc on Friday, down 0.20% to 0.97925 franc, though still not far from the six-week high recorded overnight.

  2. The pair is up 1.86% for the week.

  3. The dollar is on safe haven flows due to global economic weakness and as the country’s resilient economy paves the way for the U.S. Federal Reserve to remain aggressive in its rate hikes.

  4. The franc’s gains still weak against the dollar on Friday as the greenback had strengthened after the initial U.S. economic data indicated that its economy is still on the right track amid global uncertainties.

  5. The USD/CHF pair bounced bearishly for now, to head towards testing 0.9719 followed by 0.9688 areas mainly.

  6. Bearish bias is suggested for today, taking into consideration that breaching 0.9818 will stop the suggested negative scenario and lead the price to resume the main bullish trend again.




Important Levels to Watch for Today:

-        Resistance line of 141.027 and 142.237.

-        Support line of 138.607 and 137.397.

Commentary/ Reason:                                        

  1. The yen steadied at 140.237 per dollar, flat on the day after once again recorded a fresh 24-year high earlier in the Asian trade today.

  2. The dollar remains high against the yen, as investors braced for higher U.S. interest rates while expecting anchored Japanese rates to go nowhere anytime soon.

  3. The surge in Treasury yields heaped more pressure on the yen, prompting a warning from a Japanese government official that did little to stem the tide. Economists largely expect the BoJ to stick with its current monetary easing programme until Kuroda’s term expires in April even if it causes further weakness in the yen.

  4. The USD/JPY pair continues to rise to surpass 140.00 and approaches the new positive target at 141.027, expecting the continuation of the bullish trend domination on the intraday basis, to head towards testing 142.237 as a next station.

  5. The EMA50 continues to support the suggested bullish wave, which will remain valid conditioned by the price stability above 138.607.




Important Levels to Watch for:

-        Resistance line of 1.16278 and 1.16740.

-        Support line of 1.14782 and 1.14320.

Commentary/ Reason:

  1. Sterling fell 0.68% overnight and is down 1.5% this week. It was last at $1.15572 after touching $1.14999 overnight, a 2-1/2 year low.

  2. The risk-averse market environment is not allowing the British pound to find demand and the near-term technical outlook shows that there is more room on the downside for the pair.

  3. The pound remains pinned against the dollar as clouds gathered over the British economy. The outlook of soaring inflation threatened to hurt the pound's purchasing power and further hurt the British economy. The latest data showed that inflation in the UK picked up to a fresh 40-year high of 10.1% in July. Financial markets expect the BoE to raise its main rate by 50bps to 2.25% at its September meeting, which would be the seventh consecutive rate hike and push borrowing costs to the highest since 2008.

  4. Political uncertainty ahead of a new prime minister to be chosen next month also weighed on the pound.

  5. The GBP/USD pair showing some slight bullish bias affected by stochastic positivity, while though there’s continuation of the bearish bias as long as the price is below the broken support of the bearish channel, to head towards visiting 1.1478 areas as a next main station.

  6. Bearish trend scenario will remain valid and active for the upcoming period unless breaching 1.1627 and holding above it.