Weekly FX Chart Outlook – October 7-11
There is a light economic calendar in the week ahead as traders are left to digest the stronger US September jobs report, which has all but factored out a risk of a 50bps Fed rate cut in November.
With no key labor reports due from the US, the dollar should maintain a firm tone, even if we see some typical Monday erratic trading.
US CPI due this week is expected to be tame but with the Fed’s focus on employment, it would only confirm expectations of a 25bps rate cut and not a more aggressive one.
The wild card is the Middle East with attention on how Israel responds to the Iranian missile attack, which could come at any time. Interesting that a strong close to US stock to end the week indicated little angst over this geopolitical risk.
(Moving averages 100 day (*blue), 200 day (yellow))
EURUSD DAILY CHART
EURUSD WILL STAY ON THE DFENSIVE AS LONG AS IT TRADES BELOW 1.10
To accelerate the move to the downside, and expose 1.0880, 1.0949 would need to be firmly broken.
Note the 100 and 200 day moving averages (mvas)… potential targets if further momentum builds to the downside.
USDJPY DAILY CHART
The break of 147.20 exposes 149.37 with potential for 150 if this level is broken.
On the downside, keeps a strong bid if it stays above 148 with scaled down bids as long as it trades above 147.20.
Key area is above 150, (50% = 150.75) and 200 day mva (around 151.00)
GBPUSD DAILY CHART
GBPUSD lagged EURUSD to close the week as EURGBP retreated so watch this cross of trading GBPUSD and EURUSD.
GB{USD now dependent of 1.30 holding to stem down move with key mvas lying below it.
On the upside, key level is not until 1.3305 so expect a limited upside unless 1.32+ is renewed.
USDCAD DAILY CHART
Trying to build some upward momentum but would need to move above the 100 and 200 day would plus 1.3647 to suggest this is turning into an uptrend.
Downside should be limited on any deep dip as long as it stays above 1.35.
AUDUSD DAILY CHART
Immediate focus is on .6800 a a bias setting level but key level is not until ..6622, which i also around the 200 day mva.
If trading the AUD, look at AUDNZD, which has been trading up in anticipation of an RBNZ 50bps rate cut on Wednesday.
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Weekly FX Chart Outlook – October 7-11
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