Daily FX Analysis, Aug 16 – Major Trade Setups & Economic Events!
By Eaglefx On August 16, 2019 in Daily Market Analysis
On Friday, the U.S. dollar index experienced gains following a surge in U.S. retail sales eased concerns about the world’s top economy. Previously, the greenback was on track for a weekly gain versus safe-haven currencies such as the Japanese yen and the Swiss franc, pointing to some respite for frayed nerves following fears of recession and rallies in Hong Kong rattling financial markets.
With that, one this is clear; the market is trading risk-off sentiment and investors are looking to park their investments into the non-risky or safe-haven assets such as gold, silver, and Japanese yen while sell-off is experienced in stock markets.
Bitcoin, on the other hand, traded yesterday upwards and moved to $10,407, representing a 0.82% price increase on the day. Bitcoin has consolidated from just under $10,000 to over $12,000 this month and had most recently been on a downward streak.
BTCUSD continues to hold below the strong resistance level of 10,400, currently dropping to near $10,000. Yesterday's move looks like a lower's high. Therefore the next target can be a lower low around 9,682. However, a bullish breakout of 10,420 can lead BTC towards 10,600 and 10,900.
Economic Calendar – U.S Building Permits & Consumer Confidence!
EUR/USD – Slips Lower Amid Descending Triangle Breakout
The EUR/USD pair declined to a new 2-week low of 1.1091, as US economic figures shocked to the upside, while ECB’s Rehn discoursed about “significant” stimulus required. US Retail Sales increased by 0.7% in July, more than doubling the 0.3% boost expected.
The bearish breakout of EUR/USD below the descending triangle support area of 1.1160 has triggered sharp sell-off in EUR/USD; recalling the fact that most of the bearish bias in EUR/USD was triggered due to worse than expected GDP report.
With that being said, investors are still likely to trade EUR/USD with a bearish bias. Thus, we may see a further drop in the EUR/USD until 1.1060. The immediate resistance stays at 1.1115 today.
EUR/USD – Daily Technical Levels
Support Resistance
1.1118 1.1178
1.1094 1.1215
1.1034 1.1275
Pivot Point 1.1154
EUR/USD – Daily Forecast
I will be looking to stay bearish below 1.1115 to target 1.1080 and 1.1060 support areas today.
GBP/USD – Retail Sales Surprises
The GBP/USD spiked to place a high around 1.21400, the bearish trendline resistance area. The bullish trend triggered the release of better than expected retail sales figures. According to the Office for National Statistics, the quantity purchased in retail sales boosted by 0.5% versus the prior three months, with food stores and fuel stores seeing a decline. The quantity bought in July 2019 surged by 0.2% versus the previous month, with strong growth of 6.9% in non-store retailing.
Besides that, there's no relevant news around Brexit. The latest news announced J.Corbyn’s plan to call for a no-confidence vote on PM B.Johnson had been refused, as expected. Corby’s strategy involved snap elections, a setback in Brexit and another referendum.
Technically, the GBP/USD has come out of sideways channel, which was keeping sterling within a tight range of 1.2080 – 1.2015. The relative strength index (RSI) is crossing above 50, suggesting a slight bullish bias among traders.
However, the bearish trendline resistance on the 4-hour chart is keeping Sterling bearish below 1.2125 resistance.
GBP/USD – Daily Technical Levels
Support Resistance
1.2039 1.2089
1.2019 1.212
1.1969 1.2171
Pivot Point 1.207
GBP/USD – Daily Forecast
I’m looking to stay bearish below 1.2070 and bullish above 1.2085 with a target of 1.2120 on the upper side and 1.2040 on the lower side.
Gold – Consolidates In Narrow Range, Breakout Eyed
On Friday, the precious metal gold is trading sideways, within a narrow trading range of around 1532 - 1508 as investors are in a phase of indecision whether to go short and do profit-taking in gold or to stay bullish amid U.S.- China trade war and a steep fall in U.S. bond yields.
Gold Aug 16 by EagleFX-com on TradingView.com
Gold continues to stay supported amid trade war and other geopolitical tensions around the globe. Immediate resistance stays at 1532. It’s a crucial level as a violation of this open further room for buying until 1545.
On the lower side, gold is likely to gain support around 1,517 and 1,508.
Gold – Daily Technical Levels
Support Resistance
1,500.71 1,528.12
1,485.01 1,539.83
1,457.61 1,567.23
Pivot Point 1,512.42
Gold – Daily Forecast
On Friday, let's keep an eye on 1,532 level as gold is likely to stay bearish below this and bullish above this level.
All the best and have a profitable day!