Bad mood returns grabbing the markets lower on a risk-off trade; the downbeat data from the euro zone and china weighed heavily on risky assets. On the other hand, the U.S. labor department said Thursday; jobless claims dropped 5,000 to 348,000 this week. While, last week's number was revised t 353,00 from 351,000. The claims data confirms the current healing of the labor market, adding strength to the U.S. dollar.
The EUR/USD pair dropped sharply today, to breach the support level and the neckline for a short term head and shoulders top pattern around 1.3180, to continue the fall and test around the 200-hours Simple moving average and a prior horizontal support around 1.3140. The short term outlook has turned bearish after breaching 1.3180, however one more dip below 1.3140 could confirm further downside pressure in the upcoming sessions eying 1.3025 area. In general, downside pressure shall remain intact so long as 1.3180 continues to halt upside attempts, only a breach above it could lead to 1.3250 and 1.3290.
GBP/USD breached the main support we mentioned yesterday around 1.5820, to print a daily low at 1.5769. The pair is currently attempting to resume the bearish wave, after consolidating for a couple of hours, however stochastic is showing a bullish divergence , therefore, we need to see stochastic dipping within oversold areas to negate the divergence , in addition to price breaking below 1.5750 to confirm a sustained downside move that may extend towards 1.5650 major support level.
The JPY is benefiting from this risky environment, the safe haven has rallied today across the board, where the USD/JPYbreached the recent range bound and a double top pattern with a neckline around 83.10-83.20 area, thus the intraday day outlook has turned bearish for the pair eying further attempts to the downside towards 82.65 support followed by 82.00 level.
Gold breached the bearish continuation flag we mentioned yesterday to resume the downside move, breaking the recent low at 1635,00 , meanwhile price has gone extensively oversold over the lower time frames as seen on Stochastic indicator, thus an upside pullback could precede another downside attempt towards 1625,00 support, below 1625,00 the door shall be open to 1605,00.