Observing short-term moves in some major markets prior to the US jobs report.

Outside the New York stock exchange
Source: Bloomberg

EUR/USD triangle points to a likely down day

EUR/USD is selling off from both trendline and moving average resistance. The pair continues to trade within a descending triangle formation, which is typically bearish.

The 20-period SMA (four hour) has been respected a number of times in the past, and with the price remaining within the bottom half of the Bollinger band, it is likely that it will again push towards the lower band and support levels between $1.113 and $1.111. A move back above $1.121 would invalidate my short-term bearish view.

GBP/USD grinding lower despite break below key support

The GBP/USD pair is continuing to move gradually lower, following a break below the important $1.517 support level. This inability to really show the bearish trend and strong direction following the breakout is a little of a worry. However, for now we continue to create new lows and lower highs, which appears to be likely to resume this morning following a brief rally. Thus, I continue to favour a bearish outlook for a move back to $1.5107 and $1.51.

Until we begin to see new highs created and higher lows the outlook remains bearish, and I could see a move down to $1.5 should it begin to gain more convincing direction. A move back above $1.518 would be the initial warning sign to any bullish momentum growing.

EUR/GBP threatening to turn lower once more

The EUR/GBP pair has been showing possible signs of reversing lower following an attempted break higher above £0.7389 resistance. The creation of a new lower high after a double-top has subsequently led to a new lower low. However, it is certainly worth noting that the 20-period SMA (four hour) has been working out as an absolutely perfect support and resistance level over the past week, and we have seen the price sell off once more at this indicator.

I personally believe we will see this pair reverse lower to continue the rangebound market we have seen over the past month, and thus I am bearish for a move back to the downside with support levels to watch coming in at £0.7356, £0.7335, £0.73 and £0.725.

The problem is that given such a move could take a number of days to come through, and with today’s jobs report, I would not want to be taking the risk. Consequently, I am bearish in the lead up to the release, yet will reassess this outlook given the response to today’s numbers. 

AUD/USD breaking higher in continuation of recent resurgence

The AUD/USD pair is moving higher once more this morning as we seek to confirm the bullish connotations of yesterday’s completed double-bottom formation.

We have seen a number of recent bursts higher from $0.6938 support, and the bullish engulfing pattern this morning looks likely to spark yet another move into new territory for the week.

The key $0.7044 support level is currently holding, and this could provide a basis for another leg higher. However, ultimately I am bullish while the price remains above $0.7012, and am looking for another leg higher towards $0.7085 and $0.71.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.