Daily Forex Market Preview, 14/04/2016
Following days of trading sideways, EURUSD finally gave way yesterday and posted a 0.98% decline closing at $1.1272. We expect further declines to send EURUSD towards the $1.12 handle. Gold prices in the meantime are also looking bearish and could test $1200 following a short-term retest to the $1240 - $1245 level.
EURUSD Daily Analysis
EURUSD (1.12): EURUSD broke out from its range yesterday and continues to move lower. With the $1.13 handle breached, any upside gains could see limited price action to retest the $1.13 for resistance ahead of a steeper test to $1.12 lower support. The 4-hour Stochastics has moved stronger into the oversold levels and will likely see some minor pullback ahead of further declines. A daily close above the $1.13 handle could, however, signal further upside correction in the near term, but overall the bias remains tilted to the downside for $1.120.
USDJPY Daily Analysis
USDJPY (109.3): USDJPY has closed bullish for the second day but minds the hidden bearish divergence which is likely to see a modest pullback. With 108.95 being cleared a potential retest back to this level which marked a previous resistance level could be seen to establish support ahead of a larger move to 110.67 and 111.31 levels to test for resistance. Below 108.95, the previous lows at 107.85 will be targeted, but it is unlikely to see USDJPY give up its gains so quickly.
GBPUSD Daily Analysis
GBPUSD (1.41): GBPUSD is pushing lower again following a test to the 1.43 handle earlier this week. Price action on the daily chart is consolidating into a descending wedge pattern with the possibility of a test to 1.405. If this level holds, GBPUSD could trim its losses and move higher to 1.4425. For the moment, the support at 1.415 - 1.4126 will be key as a support failure here could send GBPUSD lower to 1.40 region.
Gold Daily Analysis
XAUUSD (1232): Gold prices have been trending lower, but price action is at the 1230 handle of support, which could see a potential pullback if this support holds. The bounce off the 1230 handle could see prices test back towards the 1243 - 1237 region, which could post a retest of the breakout from the median line. The bias remains to the downside for the moment as prices could test the $1200 handle this time around.