USDX (USD Index)
U.S dollar index closed the week below 93.00 handles, but at the start of this week, the bull return and bring the index near previous week high. If the bullish momentum could continue, it will target 94.00, and lead U.S dollar index traded inside 93.00 – 94.00 range again.
News to watch
04.30 AM UK Construction PMI estimated reading of 51.2
07.30 PM Australia Current Account forecast -$8.8 billion
Retail Sales expected to increase 0.3% monthly.
10.30 PM Australia RBA Rate Statement
For full outlook for this week, you can follow Forex Outlook For The Week 4 – 8 Dec 2017
Technical Analysis
EUR/USD
EUR/USD opened lower today, and the pair followed the plan traded inside 1.1820 – 1.1925 range. There is no change to the plan, and the pair should continue trading inside the range this week. The scenario might change if U.S dollar index continues its upward movement above 94.00 resistance.
Today critical level to watch:
Support: 1.1850, 1.1820, 1.1710, 1.1650
Resistance: 1.1925, 1.2000
GBP/USD
All major pairs which are opposite of U.S dollar experience lower opening today. GBP/USD is one of the major pairs which suffered selling today. The pair opened below 1.3450 and open the downward scenario to test breakout level around 1.3320 – 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
Normalization of USD/JPY soon will reach the crucial point 113.20. There could be selling when the pair reaches this level and possibility of shoulder-head-shoulder pattern formation which is bearish. Traders will observe the reaction at resistance and follow current possible sideway scenario between 112.50 – 113.20.
Today critical level to watch:
Support: 112.50, 112.00, 111.60, 111.00
Resistance: 113.20, 114.50
AUD/USD
AUD/USD made a bullish engulfing close above the trendline resistance which is positive. However, the pair is not safe yet as it could slide lower below 0.7550 and cancel the bullish pattern. Today, there is the possibility of trendline test. Traders could use the moment to place long position if there is a reaction.
Today critical level to watch:
Support: 0.7550, 0.7500
Resistance: 0.7630, 0.7690, 0.7750, 0.7800