US Dollar Index
Last day, the Greenback had lost hold of the 13-day old ascending slanted support line and was heading south. Simultaneously, the RSI technical indicator also had dropped from 60 level to 30.64 level yesterday. However, today, the downtrend found significant support near 96.87 resistance-turned-support line. From that point, the US Dollar Index rebounded, aiming the overhead 50-day near term SMA. On the downside, the 200-day and 100-day SMA confluence stood as a significant cushion, preventing any pullbacks.
The positive upliftment in the USD Index came on the backdrop of higher-than-expected July Unemployment and CPI data release. The most significant June MoM CPI excluding Food & Energy reported 0.1% above 0.2% forecasts. Notably, the recovery gains in the Greenback remained limited as Continuous Jobless Claims computed since June 28 missed estimates. The market had expected this Unemployment figure to report near 1.685 million. Somehow, the actual numbers came around 1.723 million, 2.26% higher than the consensus estimate.
The Fiber had broken the major counter trendline last day, signaling a breakout in the coming sessions. However, the robust 1.1288 resistance disallowed the pair's positive movements, pushing the pair below the significant 200-day SMA. The economic data also recorded upbea t report s on Thursday. Notably, the June YoY Harmonized Index of Consumer Prices published 0.2% higher than the market expectation of 1.3%. Nevertheless, a negative trend approached the EUR/USD pair's daily movements as the major rival, USD Index, arouse reaching new heights. If the drowning in the Fiber had continued, then the 50-day and 100-day SMA confluence would have got activated.
Later the day, the ECB Monetary Policy Meeting Accounts showed that the Bank might open the door for further stimulus in the coming days. The Bank quoted this decision, considering the rising trade uncertainties hurting the Eurozone exporters.
The ECB said in its account of the meeting that, "There was broad agreement that, in light of the heightened uncertainty, which was likely to extend further into the future, the Governing Council needed to be ready and prepared to ease the monetary policy stance further,"
After making a break-through out of the major counter trendline yesterday, the Cable made some good recovery moves. The GBP/USD pair climbed the ladder, taking intermediate halts at a 1-day old ascending slanted support line. However, the strong 200-day SMA restricted the pair's further upward movements, breaking the aforementioned support line. In the evening session, the pair was heading south, targeting the short term SMA confluence.
Meanwhile, BoE Governor Mark Carney proclaimed that the British Banks hold enough capital to withstand a no-deal Brexit and a global trade war simultaneously. However, Carney also alerted about the rising concerns over illiquid investment funds, liquidity shocks, cryptocurrencies, and environmental dangers.
After marking the day's opening near 0.6958 level, the Aussie pair ensured to provide slight elevations in the Asian session. Quite surprisingly, the AUD/USD pair took the flight despite mixed economic data releases. The July Consumer Inflation Expectations fell off estimates, reporting near 3.2%. Meantime, there was a slight improvement in the May Investment Lending for Homes data, this time. The May Home Loans was something intriguing, which reported 0.0% over -0.6% consensus estimates. However, the gains in the AUD/USD pair remained limited amid a strengthening Greenback.
This article was originally posted on FX Empire
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