Daily Forex Market Preview, 22/03/2016
The British Pound is likely to come under pressure as further downside momentum is likely to see the GBP give back some of its previous gains as UK's inflation data is due later today. Gold prices remain flat but another test to 1250 is likely while the bias remains to the downside.
EURUSD Daily Analysis
EURUSD (1.12): EURUSD has eased back from its bullish momentum after prices hit the resistance at 1.13. Trading within the range of 1.13 and 1.12, EURUSD is likely to continue trading sideways unless one of the levels gives way. Above 1.13, price action is likely to see a test of 14th September highs near 1.1460 while to the downside, below 1.120, EURUSD could slip towards 1.11 support. The 4-hour Stochastics is currently in the oversold level which could indicate a potential move higher towards 1.13.
USDJPY Daily Analysis
USDJPY (111.9): USDJPY closed the second day with bullish gains but remains capped below 112.0 support/resistance. A break above 112.0 will see further upside in store towards 114 resistance level while to the downside below 111.0, the next support at 110 could cap the declines. On the daily chart, USDJPY is forming a bullish divergence which could eventually see a longer term correction to 117 if the resistance at 114 breaks to offer support. On the 4-hour chart, however, the Stochastics is in the oversold levels, indicating a possible move lower to 111.31 to establish support as the bias remains limited to the downside for now.
GBPUSD Daily Analysis
GBPUSD (1.43): GBPUSD declined below the previous day's doji low and closed below 1.443. Failure to close back above this level could see further downside in GBPUSD towards 1.42. A possible retest to the 1.443 could see GBPUSD cap the upside gains for a move to test the next support near 1.4263 - 1.4247. Below this support, the bias in GBPUSD turns bearish as the next support comes in at 1.4025 - 1.40.
Gold Daily Analysis
XAUUSD (1244): Gold prices have closed the third day with declines but prices remain supported above 1246 - 1238 levels which could see another test to 1250, this time, to establish resistance. A confirmation of this could see further downside towards 1230 - 1225 levels where the next support comes in. The 4-hour Stochastics is oversold and confirms a move to the upside with an eye on 1250.