Currency Pairs Market Analysis

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EURSEK

The EURSEK pair closed below the pivot point on Friday, which is also beneath the Kernel line. This suggests a potential continuation of the price decline for EURSEK. The immediate target is the S1 support level at 11.6, followed by the lower line of the existing bullish channel. Stay tuned for more updates on the EURSEK forecast and potential trading opportunities. (Source)

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Bank of England Rate Cuts: Huw Pill Predicts Delay​

Huw Pill, the Bank of England's (BoE) Chief Economist, hinted on Monday that the bank might delay reducing interest rates from their current 15-year high until mid-2024. He found the financial market's prediction of the first-rate cut to the Bank Rate in August 2024 reasonable.


Balancing Inflation and Economic Growth

During a BoE online presentation, Pill suggested reassessing this timeline if no new developments occur. However, he acknowledged the probability of changes over the next nine months. Last week, the BoE kept its benchmark rate at a 15-year high of 5.25%, stating it had no plans for a reduction as it continues to tackle inflation, which stood at 6.7% in September. This rate is lower than the 11.1% peak in October 2022 but still significantly above the 2% target.

Pill emphasized the BoE's dedication to mitigating the risk of high inflation. However, he warned that a prolonged restrictive policy could trigger a recession or excessive economic slowdown. The BoE's latest forecasts predict that the UK's economy will remain stagnant over the next two years and grow by less than 1% in 2026. Many analysts believe the economy is already entering a recession.

Pill admitted that slowing the economy to combat inflation is challenging and assured that the Monetary Policy Committee is fully aware of the impact of its decisions, especially on individuals with lower incomes. (source)​

 

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GBPAUD​

The GBPAUD currency pair bounced from S1 (1.895 support) and is currently testing the upper line of the bullish channel. The market is bullish with the RSI indicator flipping above the 50 line. However, will the GBPAUD bulls be able to break out of the bearish channel?

Let's zoom into the 4-hour chart to gain a better insight into the currency pair. The GBPAUD situation on the 4H chart is almost the same as on the daily chart, with one difference. The RSI indicator is showing divergence, which means the market might go into a correction or trend reversal.

With the price holding below R1 (1.919 resistance), it is likely that the downtrend will continue, targeting the 1.905 pivot followed by 1.889 (S1). On the flip side, if the bulls break out of the bearish channel and manage to close above R1 and hold steady, the road to R2 will be paved. (Source)​

 

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EURUSD Forex Trading Analysis: Key Levels and Indicators

The EURUSD forex pair is currently undergoing a critical test at the 1.07 pivot point. With the Relative Strength Index (RSI) inching closer to the mid-point of 50, traders are keeping a close eye on the market dynamics.

Should the bears manage to push the price below this level on the 4-hour chart, the next target on the downside is expected to be 1.058. This potential move could signal a shift in market sentiment and a possible strengthening of the USD against the Euro.

However, as long as the EURUSD pair maintains its position above the pivot, the market trend remains bullish. This suggests that the Euro is still holding its ground against the USD. (Source)​

 

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GBPNZD

The bulls on GBPUSD are testing the upper line of the bearish channel. This level coincides with the Ichimoku cloud. Therefore, this is a strong barrier for the GBPNZD bulls to overcome. The trend is bearish as long as the price trades inside the bearish channel.

If the GBPNZD bulls can break out of the bearish channel, the next resistance is at 2.1. The overall trend is bearish. Let's zoom into the 4H chart to find triggers for the bearish trend.

The pair formed a long-wick candlestick pattern in today's trading session near R1 (2.08 resistance). If the pair falls below the Kernel line of the Lorentzian Classification indicator, the downtrend will continue with bears targeting the lower line of the bearish channel. (Source)​

 

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GBPNOK​

The GBPNOK pair is currently exhibiting a bullish trend, trading within a bullish channel. However, the Relative Strength Index (RSI) indicates an overbought market, and the pair is showing a downward trend. It's probable that the pair will test the 13.62 pivot point or the lower boundary of the bullish channel before making further gains.

The 13.545 level lends support to this bullish scenario. If this level is breached, it would invalidate the bullish channel. Subsequently, the next target for the GBPNOK bears would be the 61.8% Fibonacci retracement level. (Source)​

 

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GBPSEK

The GBPSEK currency pair is trading below the bearish trendline on the daily chart. In terms of the technical indicator, the GBPSEK price is hovering below the 13.384 pivot, the Kernel channel, and the RSI indicator is below the level of 50. According to the data we received from the chart, the market is bearish on GBPSEK. The bears' first target is the 13.3 support, and if this level breaks, the next target would be around the 13.0 area.

The bearish scenario will be invalidated if the GBPSEK price breaks and stabilizes above the bearish trendline. (Source)

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EURUSD Technical Analysis

The EURUSD has rebounded from the 1.06 pivot point, as anticipated. As long as the pair trades above this pivot, it's plausible for the EURUSD bulls to target the 1.081 resistance level.

However, if the pivot is broken and the bears close below it in the 4H chart, the bullish outlook will be invalidated, shifting the bearish target to S1.​

 

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USILS

FxNews — The decline of the USDIL currency pair continued to the 50% level of the Fibonacci retracement. The Israeli Shekel is currently testing the Ichimoku cloud while the RSI indicator is nearing the oversold area. Please note that the current military operation and the conflict situation in Gaza have made this currency very unstable and hard to predict. We would like to take the opportunity to express our condolences to the people of Israel who lost their loved ones, children, and soldiers during the fight against the Palestinian terrorists, Hamas.

To have a comprehensive outlook of the USDILS price action, we zoom into the 4H chart. The bears have aggressively bet on the Israeli Shekel currency, which has led the RSI indicator to hover in the oversold area for a week now. Since the pair is extremely oversold, we don't suggest bidding on buying. Analysts at FxNews suggest waiting for the price to make a correction. If the price can break out of the bearish channel in the 4H chart, it would probably rise to test the pivot.

The pivot can provide a decent demand zone for the bears to add another pressure. Please watch these levels closely and look for candlestick patterns such as doji, bearish engulfing, or long wick candlestick patterns before initiating a trade.​

 

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GBPUSD

The GBPUSD pair experienced a decline after reaching the significant 1.24 mark. Currently, the pair is delicately poised below the pivot point, testing the resilience of the bullish channel's median line.

In the short-term, if the GBPUSD price manages to maintain above the crucial 1.225 support level, we could witness a bullish trend. This scenario presents an optimistic outlook for traders who are bullish on the GBPUSD.

However, a break below the 1.225 level could signal a potential downturn, extending the decline to the 1.21 mark, which represents the lower boundary of the bullish channel. This development would be significant for those keeping a close eye on this currency pair.​

 

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USDMXN​

FxNews - The USDMXN downtrend eased at the 61.8% level of Fibonacci retracement. This level coincides with the Ichimoku cloud, which makes this resistance level powerful. Moreover, the RSI indicator shows divergence, which can be a signal for a range market or trend reversal.

To gain better insight and find triggers, we zoom into the USDMXN 4H chart. The pair is currently trading in a narrow range, shown with the blue box on the 4-hour chart. The pivot plays the role of resistance. If the price holds below this level, another fall is expected, targeting S1 (16.998).

On the other hand, if the USDMXN price can stabilize above the pivot, we can expect the pair to see some upward momentum toward R1 (17.8 resistance).​

 

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GBPJPY Forex Analysis: Bullish Trend and Key Resistance Levels

The GBPJPY currency pair is currently trading above the trend line and the significant resistance level of 184.5. The market trend is bullish, as indicated by the Relative Strength Index (RSI), which is consistently above the 50 level. Given the current trend, we anticipate the pair to break the R1 resistance level and aim for R2 as its next target.

The pivot point is providing substantial support to the bullish scenario. However, if this level is breached and the GBPJPY price stabilizes below it, the bullish scenario may no longer hold.​

 

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Yen's Fall: Impact of Divergent Monetary Policies

The Japanese yen has once again fallen below 151 per dollar, potentially heading towards its lowest value since 1990. This is largely due to the contrasting stances of the US Federal Reserve and the Bank of Japan (BOJ) on monetary policy. Earlier this week, Jerome Powell, the Chair of the Fed, suggested that additional interest rate increases might be necessary to control inflation.

Diverging Monetary Policies

On the other hand, Kazuo Ueda, the Governor of the BOJ, has advised caution given the current uncertainties. He recognized that the divergence in policies has contributed to the yen's depreciation but did not explicitly express support for the currency. Earlier this month, the BOJ held its policy rate steady at -0.1% and kept the 10-year JGB yield target at approximately 0%. It also made minor modifications to its yield curve control policy, loosely defining 1% as an "upper bound" rather than a strict limit and removed a commitment to uphold this level by offering to purchase an unlimited quantity of bonds.

In terms of the economy, a weaker yen can be both beneficial and detrimental. On one hand, it can boost exports by making Japanese goods cheaper for foreign buyers, which can stimulate economic growth. On the other hand, it can increase the cost of imports and potentially lead to inflation. Therefore, whether it's good or bad for the economy depends on a variety of factors, including the balance of trade, the rate of inflation, and the overall health of the global economy.​

 

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USDSGD

FxNews - The USDSGD bounced from the November low (1.3489) and currently, the bulls are testing the 1.3607 resistance. The RSI indicator is nearing the level of 50. The market outlook for the USDSGD is bullish. However, to gain a better insight into the USDSGD price action and trigger points, we zoom into the 4-hour chart.

There is no sign of bear intervention in the 4H chart in terms of the candlestick pattern. Given the current situation, it is likely for the bulls to break the 1.3707 and aim for the 1.376 area as their next target.

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USDCAD Analysis

FxNews - The USDCAD pair is trading within a bullish channel. This week, the bulls in USDCAD closed above the pivot, and currently, the price is struggling to break out above the median line of the bullish channel.

The RSI indicator is hovering above the 50 level. The trend is bullish and is likely to aim for R1 (1.399 resistance). S1 and the lower line of the bearish channel support the bullish scenario. As long as the pair is trading within the channel, the overall outlook of the trend is bullish.​

 

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EURUSD Market Outlook: Bullish Trend Amid Bearish Flags

The EURUSD currency pair is currently navigating within a bearish flag pattern, yet it remains above the Ichimoku Cloud, signaling a potential bullish market. As the pair tests the resistance at 1.06988, the market anticipates a possible upward trend.

EURUSD bulls face the challenge of the bearish flag, which stands as an obstacle to driving the price towards the next resistance level at 1.07353. However, as long as the EURUSD continues to trade within the confines of the bearish flag, the primary target remains at testing Support 1 (S1).

Conversely, should the bulls manage to break out of the bearish channel, it could pave the way towards Resistance 3 (R3). This scenario would indicate a significant shift in market dynamics, potentially triggering a new wave of bullish momentum for the EURUSD pair.​

 

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A Closer Look at the Positive Turnaround for Spanish Stocks

FxNews- The Spanish stock market has recently experienced a significant upswing, with the IBEX 35 index climbing to 9,440. This rise brings the index near its two-month peak, outpacing the majority of its European counterparts. The banking sector appears to be the driving force behind this surge, as it has seen substantial gains.


The Banking Sector Spearheads the Rally

Among the banks, Banco Sabadell emerged as the top performer with a 3% increase, followed closely by Bankinter with a 2.6% rise. CaixaBank and BBVA also contributed to the rally with gains of 1.9% and 1.4% respectively. This upward trend in the banking sector has played a pivotal role in the overall performance of the Spanish stock market.


Other Sectors Join the Upward Trend

The telecommunications and real estate sectors have also seen considerable advances, following the lead of the banking sector. However, not all sectors shared in the prosperity. Acciona and Acciona Energia, for instance, experienced a slight downturn, with their stocks falling by 0.8% and 0.7% respectively.


A Broader Perspective

On a larger scale, investors seem to have brushed aside the recent downgrade of the US debt outlook to negative by Moody's. Instead, the focus has shifted to key inflation releases due this week. The impact of these releases on the global and Spanish economy will be something to watch closely.

In conclusion, the rebound of the Spanish stocks, led by the banking sector, paints a positive picture for the country's economy. However, it's important to keep an eye on the broader economic landscape, including inflation rates and international credit ratings, to fully understand the potential implications for the economy.​

 

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EURJPY

The EURJPY currency pair has recently experienced a bounce from the upper line of the bullish flag, as observed in the 4-hour chart. This significant movement has caused the Relative Strength Index (RSI) to flip below the overbought zone. Despite the bullish trend, there's a possibility that the pair might correct the recent gains to the 160.7 support level, also known as S1.

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EURGBP

FxNews - The EURGBP trend is bullish, with trading in the upward flag. However, the uptick momentum eased this week after the EURGBP price hit the middle line of the bullish flag in the daily chart.

To have a better insight into the price action, we shall zoom into the EURGBP 4H chart. The pair broke the bullish trend line in the 4H chart (shown in red), and currently, it is testing the 0.872 pivot. If the price closes below the pivot, the correction would likely continue to the lower levels, starting with the 0.868 support (S1).

Please note, the market is bullish. Therefore, going short on the currency pair is not suggested. The 0.868 deck provides a decent supply zone to increase bullish bids on the pair.​

 

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GBPUSD Technical Analysis

News Solid ECN - The GBPUSD currency pair is declining after encountering resistance at the upper band of the channel, as anticipated. Currently, the pair is showing downward momentum, trading below the 1.228 pivot point. Notably, the RSI indicator has risen above the 50 level, indicating that bulls are attempting to retest the pivot.

As long as the pair stays below the pivot, the outlook remains bearish, with 1.213 (S1) as the target.

Conversely, if bulls manage to close above the pivot and stabilize the price, the GBPUSD could potentially rise, retesting the R1 level again. However, please note that the trend is still bearish; even if the pair rises to test R1, going long is not recommended. The R1 level or the upper band of the bullish flag may provide a strong resistance zone, offering bears an opportunity to exert additional pressure.​