INTRADAY TECHNICAL ANALYSIS 2 NOVEMBER (observation as of 05:15 UTC)
[EURUSD]
Important Levels to Watch for:
- Resistance line of 1.16542 and 1.16918.
- Support line of 1.15326 and 1.14950.
Commentary/ Reason:
The euro was about flat at $1.1608.
The pair has erased all the gains it registered last week after the ECB meeting and have started the new week under modest bearish pressure.
The dollar gain ground as investors seem to be readjusting their positions to the tapering prospects. The FOMC widely expected to announce a tapering of stimulus on Wednesday.
A rally in the equities to a new record high Monday however seems to limit the liquidity demand for the dollar.
The EUR/USD has rebounded from the 1.153 support line and price action looks set to oscillate. Given the steady RSI and a lack of momentum strength, the pair’s recovery moves are likely to be halted.
[USDCHF]
Important Levels to Watch for:
- Resistance line of 0.91499 and 0.91714.
- Support line of 0.90805 and 0.90590.
Commentary/ Reason:
The dollar slumps to fresh three-month lows against the Swiss franc on Tuesday, trading at 0.90918.
Broad greenback weakness across the board weighed on the USD/CHF. Furthermore, investors seem convinced that the Fed would hike rates by the beginning of the second half of 2022.
On the other hand, the Swiss franc gains momentum on its safe-haven appeal. The risk-off impulse in the market today benefitted the safe-haven Swiss franc.
Intraday bias in USD/CHF stays neutral first, and further decline is expected with 0.915 resistance intact. On the downside, break of 0.908 will target 0.905 support. On the upside, however, break of 0.915 resistance will turn bias back to the upside for 0.917 resistance instead.
[USDJPY]
Important Levels to Watch for Today:
- Resistance line of 114.340 and 114.598.
- Support line of 113.506 and 113.248.
Commentary/ Reason:
The dollar traded 0.16% weaker at 113.739 yen.
The dollar eased, after approached a 1 1/2-week top to the yen in the previous session, as traders position themselves ahead of this week's highly anticipated U.S. Federal Reserve policy meeting. The Fed will announce its policy decision on Wednesday when Japanese markets will be shut for a public holiday.
The USD/JPY pair will be contained within the current tight trading range in the near-term as selling pressure rises each time the pair attempts a break.
[GBPUSD]
Important Levels to Watch for:
- Resistance line of 1.38274 and 1.38900.
- Support line of 1.36246 and 1.35620.
Commentary/ Reason:
Sterling stays on the back foot ahead of key events, traded at $1.36596, and earlier dipped to $1.36419 for the first time since mid-October.
The Bank of England is due to announce its policy decision on Thursday, a day later than the Fed. The BoE heads this week into its most unpredictable interest rate decision in years, leaving investors and analysts on edge about the chance of its first hike since the pandemic struck the world economy.
The pound meanwhile continue to be pressured as Britain and France clashed again in a post-Brexit trade fishing right.
The GBP/USD pair has pulled back towards the 1.362 support line which also represents the lower bound of the trading range. Indecision in recent trading suggest that sellers have lost steam after a selloff to end the previous trading week.
