Recapping the Majors
EUR/USD– Talk about ranging! The Euro made an exact carbon copy of yesterday’s candle except today the Euro rose instead of dropping. The pair stayed fairly quiet as it stayed within the 3300-3400 range without peaking out of that range. This marks the 8th day that the pair has been "stuck".
Result: The Euro rose slightly against the Dollar today but remains stuck in the 3300-3400 range.
GBP/USD- The Sterling also stayed relatively quiet as it simply hovered around 9750 without making too much of a swing in either direction. The pair had bounced down off of the 9800 level and today looked like it was one of those indecision days where the market is still figuring out if it should continue to fall or try and break the 9800 level.
Result: The Sterling and Dollar pretty much had a draw as the price barely moved at all.
USD/CHF- The Swissy met resistance at its 38% Fib line as well as its 50 EMA on the daily chart as it bounced down to as low as 2172. The pair is currently trading above 2200 which could be a good thing for the Dollar bulls if it ends up closing above it. Remember that the pair had been ranging between 2100-2200 for quite some time so any close above 2200 could be a good sign if you’re looking to go long on the pair. The next barrier is the 38% Fib line as well as the 50 EMA.
Result: The Swissy pushed the Dollar down early on but the Dollar has rallied back above 2200 and only suffered a minor loss.
USD/JPY- 119.00 seemed to hold its ground as the pair was unable to break that level and proceeded to fall to as low as 118.54 and seems to be hanging around there at this point. 118.50 should provide good support since it previously was a good resistance level. Today may just have been a retracement and the Dollar could continue its rally if the 118.50 support holds strong.
Result: After a very strong Dollar rally yesterday, the Yen was able to hold the Dollar off as it pushed it down about 50 pips.
Chart Analysis: What’s going to happen next?
You can probably tell by now that my posts concerning the Euro have been anything but decisive. The pair is simply floating between the 3300-3400 range and isn’t really doing much. Today the pair once again floated up and failed to break past 3300 which continues its range bound pattern. 4hr and daily stochastics are both trending up at this point which could mean that the pair could float back up towards 3400. Until we see some major fundamental catalyst I think we’ll see the pair hold at 3400 and continue to fall back down to continue its "range" pattern.
After bouncing down off of the 9800 level the pair merely stayed put today. Daily stochastics are still right at the overbought area which could indicate a drop sometime in the medium term. However 4hr stochastics are near oversold territory and could move up in the short term. A likely scenario for this pair is for it to head upwards towards 9800 and then we should see another drop unless something fundamentally important happens that could cause the pair to rally past 9800.
The resistance at the 38% Fib line and 50 EMA held strong and the pair bounced down below 2200 but is now trading just above the 2200 mark. Remember that the pair was ranging between 2100-2200 so if the pair can continue to close above 2200 we may be seeing more bullish movement in the short-medium term. 4hr stochastics are trending down which means we could see the pair dip below 2200 again but daily stochastics are still trending up which supports my bullish sentiment for the medium term. The next thing to watch is whether or not the pair can break the 38% Fib line and its 50 EMA. If it does, then look for the pair to hit its 100 SMA which is currently at 2270.
The Yen bounced down off of the 119.00 level and held support at its 100 SMA on the daily chart. 4hr stochastics are trending down after just leaving overbought territory which indicates that we might see more of a retracement in the short term. Daily stochastics are also starting to head into overbought territory which means we could see some downward movement in the medium term as well. However, 118.50 should be a pretty tough support level to break since it was previously a very tough resistance level so I’m still somewhat bullish on the pair unless the pair can break this level. Currently the pair is trading at 118.66 and I think we’ll see it drop to its 50 EMA which is currently at 118.37 but if the 118.50 support holds strong we should see the pair bounce back up after retracing down around this area.