NEWS / Indicators

Daily Technicals: Dollar bid on Mid-East worries

by Marc Spaelti

EURUSD: Worry that the situation in the Middle East could escalate keep the Dollar bid, it traded down to 1.2665 but recovered to close the day at 1.2695, a touch underneath of the 1.27 key. It remained underneath of this weeks short-term bearish trend, resistance now at 1.2695 and has just made a new low of 1.2655. As we head into the weekend, expect more Dollars to be bought for safety-reason and risk is to continue falling down to medium-term and next key support at 1.2575, on the way lower minor support at 1.2620. On top, 1.2700 is now pivot, a break should lift the pair to 1.2785

GBPUSD: Cable outperformed the rest with a spike to 1.8465 high. The move was stopped as other currencies remained under pressure and Cable was pulled back to 1.8410 for the close. This morning the 1.8405 support gave way and Cable fell to 1.8360. Strong initial support 1.8350, risk is still to widen the dip in search of medium-term support, it??™s at 1.8295 today and is still seen as the ultimate buy level for a move through 1.85. On top minor resistance 1.8385, strong 1.8460, key 1.8540.

USDJPY: BOJ has hiked interest rates for the first time in six years, the move was widely expected and the YEN did not profit from the move, instead it traded bid again this morning, reaching a high of 116.10. Strong resistance only at 116.60, medium-term trend-line at 117.00 is key-level, a weekly close above can drive the Dollar to 118.80 next week. The bearish view is on hold for now, initial support 115.65 and short-term rising support at 115.10, key at 114.65.

USDCHF: While the Dollar follows the up&down??™s of other currencies, the traded range has not changed at all this week, 1.2260/1.2360 remains, key resistance 1.2400 today, while this holds we will maintain a bearish medium-term view. In case of a break the pair can rise to 1.2450 or even 1.2525 strong resistance, underneath additional support 1.2225 and 1.2160 strong.

@12:30GMT US Retail Sales June
@13:45GMT US U.Michigan Sentiment July preliminary
@14:00GMT US Business Inventories May