U.S. existing home sales fell to 4.59 in february million from the revised up 4.63 million in January and below market expectations of 4.61 million. The number failed to confirm the relatively good numbers of housing starts and permits we have seen yesterday, adding skepticism to the outlook of the sector.
The initially reaction has been dollar positive so far, however, the recent strength of the greenback was mainly supported by good economic data and lower expectations of one more round of easing; thus a lagging housing market and failure to confirm the current recovery's momentum could be dollar negative in the near term.
The euro dollar pair fell today; however currently paring losses after digesting the news; the pair is retesting 1.3250 intraday breached support which turns into resistance now, a push back above could lead to another test of the recent highs around 1.3285-1.3290 major resistance.
In the near term, the current short term bullish trend seen on the provided hourly chart shall not extend unless we see a clear breach with steady trading above the aforementioned swing high, and that would push the pair higher to 1.3350 and 1.3400 levels. To the downside, failure to trade back above 1.3250 with another downside attempt could lead to testing the previously breached neckline for the inverted head and shoulder pattern around 1.3180.
The GBP/USD just rebounded from 1.5820 major intraday support following the release, stochastic has dipped within oversold area and currently attempting to gain momentum ; thus with holding above the aforementioned support we may see a retest of 1.5915 high and resistance level, while breaking below 1.5920 with few hours of trading shall confirm another selloff eying 1.5750 level.
The USD/JPYwent to trade back below 83.95 support level , which is an intraday negative sign, we may see a push lower especially that Stochastic has left overbought territory, the pair should find a minor support around 83.50, however the main support is located among 83.00-83.15 area. The current bullish trend is in favor over the medium and long term; however we need to see a break above 84.20 over daily closing basis to look for 85.00 and 85.50 major swing high.
Gold is trading within a short term ascending channel, while this is a normal bullish channel over intraday basis, over the longer time horizon it can be considered as a bearish continuation flag for the recent bearish trend. Over the near term a break above 1658.00 over hourly closing basis could extend the move to the top of the channel around 1670.00. On the other hand a breach below the ascending support of the formations hall signal the continuation of the major downside trend towards 1635,00 and 1600,00