Overall: “The forex markets were dollar dominated on Tuesday, and most of the majors moved lower against the greenback” said TheLFB-Forex.com Trade Team members. ” The biggest hit was delivered to the euro, in reaction to stocks and oil moving lower, and growing concerns that the European economy may have another rate cut imposed on it over the next two months that will further depreciate the euro”. Below are the insights that the Team has on the major pairs, which are expanded dramatically each day the Members area of the site.
The Euro (Eur/Usd) absorbed heavy selling on Tuesday that was able to push valuations down through the 20 day SMA area at 1.3300. The 4 hour chart just broke into short mode, something that will need to be watched if further selling then creates enough momentum to test the low side 1.3250. That area is a big swing point area that euro buyers may need step in to if 1.3000 is not to be tested.
The Pound (Gbp/Usd) held steady in trade on Tuesday and managed to fend off selling pressure coming from dollar index strength. This is the weakest looking major pair technically, but proved today that it will need more than poor equity trade to get it below 1.4500. It looks as though fair value has been found on the pound.
The Aussie (Aud/Usd) ended the session flat on the dollar after the Tuesday morning rate decision from the RBA found both buyers and sellers in equal measure. The pair was one of the majors that looked uncomfortable going lower, and may nudge itself northbound as the Asian session gets underway. The rate cut has done nothing to dampen demand for the aussie, and it seems as though it is a case of when, and not if, the next test of 0.7250 is seen.
The Cad (Usd/Cad) moved in a tight range on Tuesday, after it found support at the top of the 4 hour chart channel in overnight trade, and formed a swing point that will be monitored closely this week at 1.2500. We are on high alert for break on cad, and will be getting trade signals from this pair it seems; the week is loaded with Canadian data that will feed through to price action. TheLFB Pivot Point support at 1.2250 was tested and held on Monday, the resistance 1 area at 1.2500 was tested and held on Tuesday, and now we may trade within the 1.2250-2500 channel as we await the moves in reaction to economic releases.
The Swissy (Usd/Chf) moved higher to test bids at the 20 day SMA resistance area in European trade, and then held that ground around 1.1450.
The Yen (Usd/Yen) traded in a tight range of 100 pips on Monday and Tuesday, and managed to hold again above the 200 day SMA area at 99.25, and once again above the 100.00 price point. If Asian markets can hold steady in early trade and negate the Wall Street selling the pair may make the next leg higher to possibly test the 101.70 area.