USDX (USD Index)

In the previous week trading session, U.S dollar index tumbled at the end of the week and formed a bearish engulfing pattern. The bearish reaction happened due to China tariff retaliation and President Trump tweet. China decides to slap a tariff on additional $75b U.S imported goods. The tariff will take effect on September 1, and December 15.

President Trump tweeted that the U.S does not need China and order U.S companies to find China alternatives. Aside from the tweet, the U.S now will impose 30% tariff against China products compared to 25% planned on September 1.

Meanwhile, G-7 meeting kick-off and Trump incite tension after he said the member need to readmit Russia into the group.

News to watch

For full outlook for this week, you can follow Forex Outlook For The Week 26-30 August 2019

EUR/USD

EUR/USD returned above 1.1120 and open the upward possibility. However, there is no follow-through by the bull and the price currently testing 1.1120 support. Will the pair manage to stay above 1.1120 by the end of day and start moving up toward 1.1185 and the top trendline?

today critical levels to watch:

Support: 1.1120, 1.1100, 1.1000

Resistance: 1.1185

GBP/USD

GBP/USD stick near the bottom of the channel and looking to break out inside the channel. At the current time, there is a limited bearish reaction which gives traders no clue in the next direction. Traders will continue to monitor the pair reaction at the bottom of the channel.

Today Critical level to watch:

Support: 1.2100, 1.2000

Resistance: 1.2300, 1.2400

USD/JPY

USD/JPY drop lower in today trading session and reached 105.00 support. The pair continue lower below the major support level and touch 104.50 before reversing its direction. Currently, the pair has returned above its opening level and might continue upward to test 106.10. Short positions could be considered with a stop above 107.00. However, it is better to wait until the bullish pressure recede.

Today critical levels to watch:

Support: 105.00, 104.67

Resistance: 106.10, 106.70, 107.00

AUD/USD

AUD/USD initially slip below the bottom of the blue box and indicate a breakout. But the pair has returned inside the box area and currently traded above its opening level. It looks like the pair will continue its ranging movement inside the box area with a short-term bullish bias. Traders could look for long positions with the top of the box as a target.

Today critical levels to watch:

Support: 0.6700

Resistance: 0.6800, 0.6900