USDX (USD Index)
The upward movement of U.S dollar index stopped and reversed yesterday. After gained for the entire day, the bear seized control and brought the index to close below opening level. Overall, the index higher compared to Friday close.
Today, the bull attempt to bring the index higher after tested 93.00 support. The situation development is not favorable as the price return near its opening level. In the end, the bull needs to make a major advance from 93.00 support. Otherwise, it risks breakdown lower.
News to watch
10.00 AM U.S ISM Non-Manufacturing PMI, estimated reading of 59.2
07.30 PM Australia GDP, consensus increase of 0.7% quarter to quarter.
For full outlook for this week, you can follow Forex Outlook For The Week 4 – 8 Dec 2017
Technical Analysis
EUR/USD
EUR/USD tested the lower range of 1.1820 – 1.1925 as expected. The pair found support and show a possible bounce. We expect the pair will continue its sideways movement inside 1.1820 – 1.1925 range.
Today critical level to watch:
Support: 1.1850, 1.1820, 1.1710, 1.1650
Resistance: 1.1925, 1.2000
GBP/USD
The bull did a good job maintaining GBP/USD position above 1.3450 yesterday. Unfortunately, the pair slide today after service PMI result come out worse than expected. The number shows a reading of 53.8 while the market expectation was reading of 55.2. It is possible for GBP/USD to continue lower to test level around 1.3300 – 1.3330.
Today critical level to watch:
Support: 1.3400, 1.3342, 1.3300, 1.3250
Resistance: 1.3450, 1.3500, 1.3600
USD/JPY
The normalization movement of USD/JPY reached a level near 113.20 and reversed its direction. The movement qualifies as resistance test and suggests possible bearish continuation. Traders must note, USD/JPY not yet make a close above 112.50 which put the bull under the risky situation. If the bull could not secure 112.50, USD/JPY might start a new bearish leg.
Today critical level to watch:
Support: 112.00, 111.60, 111.00
Resistance: 112.50, 113.20, 114.50
AUD/USD
AUD/USD is currently testing its flip level around 0.7640. Although the pair shows significant gain from its opening level, it still needs to clear the resistance first. If AUD/USD settled below the flip level, traders might want to stay careful with the long position. Bear traders could look for a short opportunity at the current level.
Today critical level to watch:
Support: 0.7550, 0.7500
Resistance: 0.7630, 0.7690, 0.7750, 0.7800