Daily Market Report – EUR/USD Losing Altitude November 03, 2017

EUR/USD Should Hit New Lows

The currency pair is trading in the red and tries to drop much deeper on the short term as the USDX has managed to erase the earlier losses and to reach new highs. The dollar index rallied in the last hours and could reach the 95.00 psychological level till the end of the night. A further USDX’s increase will force the EUR/USD to drop much deeper in the upcoming days, the index has managed to stay above an important support level, so technically should increase and should reach the 95.17 previous high very soon.

The greenback edges higher versus its rivals as the ISM Non-Manufacturing PMI jumped from 59.8 to 60.1 points,  boosting the greenback, the Factory Orders have come in better as well, have increased by 1.4%, beating the 1.3% estimate.

The rate plunged after the retest of the median line (ML) of the major ascending pitchfork. I’ve said in the last reports that the rate could come to retest the major resistance (support turned into resistance) before will resume the downwards movement. The failure to close on the ML will confirm a quick drop in the upcoming days.

The next downside target will be at the sliding line (SL), should also reach the lower median line (lml) of the minor descending pitchfork.

USD/JPY Crucial Breakout

The USD/JPY increased and stands above the median line (ml) of the minor ascending pitchfork and above the 23.6% retracement level. Price continues to fight to stay above the mentioned resistance levels, so a valid breakout will confirm a larger increase, it could be attracted by the upper median line (uml) of the minor ascending pitchfork, this scenario will take shape only if the USDX and the Nikkei will climb much higher.

EUR/JPY Losing Momentum

Price is trading in the red and failed to reach and retest the outside sliding line (SL) of the major ascending pitchfork, signaling that the bears could strike back anytime again. Technically, it was expected to reach and retest the upper median line (UML) of the major ascending pitchfork after the breakout from the Rising Wedge pattern. A larger drop will come after a breakdown below the UML and below the 131.0 psychological level.

By Olimpiu Tuns – Market Analyst