USDX (USD Index)
The bullish movement continues in the U.S dollar index and brought the index to reach the top of the yellow box today. Now, traders will observe the market reaction near the resistance. Will there be rejection or breakout above the resistance? Nevertheless, the current position of the U.S dollar index is ideal for the short position if the ranging trend inside the yellow box continues.
News to watch
12.45 AM Fed Chair Powell Speaks
For full outlook for this week, you can follow Forex Outlook For The Week 1 – 5 October 2018
Technical Analysis
EUR/USD
EUR/USD stumble below 1.1580 and could become the initial sign the pair ready to trade between 1.1500 – 1.1580. The bearish pressure expected to continue without change and possibly breakout below 1.1500 this week. There is a speech by Fed President Jerome Powell today which might provide a clue on the pair next movement.
Today critical level to watch:
Support: 1.1500
Resistance: 1.1580, 1.1600, 1.1650
GBP/USD
GBP/USD holding out above 1.3000 but could not make significant bounce from the support. Currently, the bear is testing the support level and it seems only a matter of time until breakout happens. The breakout below 1.3000 will lead GBP/USD down toward black trendline or 1.2800.
Today critical level to watch:
Support: 1.3000, 1.2800
Resistance: 1.3100,1.3125, 1.3250,1.3300
USD/JPY
There are two support levels to watch if USD/JPY make a correction. First is 113.20 the other is 112.50, traders could use both levels as the location to place long positions. We think the pair still has more room upward to 114.50 – 114.72 target.
Today critical level to watch:
Support: 113.20, 113.00, 112.50, 112.00
Resistance: 114.00, 114.50
AUD/USD
Although the movement is slow, we are convinced AUD/USD will reach 0.7160 soon. When the pair hit the support level, traders could scale out of long position while waiting for breakout happen. Long position from 0.7160 might be a good idea, however, the overall trend is bearish which suggest traders to take fewer positions.
Today critical level to watch:
Support: 0.7160, 0.7100, 0.7000
Resistance: 0.7300, 0.7330