INTRADAY TECHNICAL ANALYSIS 11 NOVEMBER (observation as of 06:20 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.15923 and 1.16395.

-        Support line of 1.14433 and 1.13969.

Commentary/ Reason:

1. The euro was pummelled down 1% to $1.144647 overnight, its lowest level since July 2020, after the U.S. CPI reading.

2. The pair continue to be pinned at that level on Thursday and last stood at $1.14778.

3. The dollar was strong after U.S. consumer inflation surged to its highest since 1990, raising concerns the Federal Reserve will tighten monetary policy sooner than expected and well before the ECB.

4. The inflation concerns sent T-note yields soaring and gave the dollar a boost after the 10-year T-note yield jumped to 1.548%. The dollar also extended its gains after U.S. weekly jobless claims fell to a 19-month low.

5. EUR/USD is technically oversold in the near term but is still poised to extend its slump.

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.92089 and 0.92413.

-        Support line of 0.91038 and 0.90713.

Commentary/ Reason:

1. The Swiss franc traded lower against the U.S. dollar on Thursday on better buying interest for the greenback, slipped 0.08% to trade at 0.91887.

2. The dollar rose to one-week high against the franc.

3. US inflation data came in higher than expected at 4.6% against the forecast of 4.3%, thus becoming the main catalyst for the upward movement in the dollar-franc pairing.

4. The USD/CHF pair has rebounded as buyers returned to the dollar in yesterday’s session. It may be the impetus needed to drive price action going forward, which had previously been consolidating at the trendline.  

[USDJPY]

Important Levels to Watch for Today:

-        Resistance line of 114.342 and 114.829.

-        Support line of 112.765 and 112.277.

Commentary/ Reason:                                        

1. The dollar stood at 113.957 against the yen, hovering around its one-week high it touched earlier in the session, after the hottest U.S. inflation reading in a generation fanned bets on rate hikes.

2. The pair moved sharply higher as soaring T-note yields weighed on the yen.

3. Also, central bank divergence weighed on the yen, with the Fed expected to tighten monetary policy well before the BoJ.

4. The USD/JPY has found support once again with strong bullish moves taking price action back towards the 114.34 resistance line. A brief break out of the consolidation range in recent trading was overcome by fundamental factors in yesterday’s session.  

[GBPUSD]

Important Levels to Watch for:

-        Resistance line of 1.35612 and 1.36250.

-        Support line of 1.33548 and 1.32910.

Commentary/ Reason:

1. Sterling rebounded fractionally on Thursday, rose 0.14% to $1.34202, though still hovering around its lowest since December 2020, after the pair dropped 1.14% overnight.

2. Sterling slumped after U.S. consumer prices recorded their largest year-on-year advance since November 1990, which fanned bets on rate hikes in the U.S, while Bank of England's decided to keep rates unchanged.

3. The British pound also pressured after Britain and the European Union looked far from finding a post-Brexit agreement over Northern Ireland.

4. The GBP/USD pair is testing the 1.335 price low, as a strong sell-off in yesterday’s trading saw the pair break a recent low at the 1.341 support line. The move has cemented the already established longer-term bearish trend, yet it remains to be seen whether current price levels will be sustained or driven lower. 

5. In the meantime, investors await the UK preliminary estimate of Q3 GDP growth on Thursday.