EU Session Bullet Report – Bomb scare in Europe spooks markets as Dollar stays firm

Asian stocks fell early on Wednesday as risk appetite was hurt following unfolding events in Europe. A bomb scare led to an international friendly match between Germany and the Netherlands being cancelled, whilst gunfire in a French suburb, as special forces launched an operation to catch one of the suspects in connection with Friday’s events also sparked fresh fears over further attacks.

As a result, markets have been slightly subdued although USD strength remains, as an expected December rate hike by the Fed remains on track. Gold continues its slippery slide having broken through a key support level (1077) and is currently trading at 1070.50 at time of writing, perhaps paving the way for further downside towards 1000.

Oil in the meantime has recoverd slightly and is up just above $42 following Monday’s $40.05 low although as long as it remains below the $42.25 resistance line, further downside is expected.

Today, we have a quiet calendar in Europe. From the US later today we have building permits and FOMC meeting minutes to look out for.

Trading quote of the day: “Beginners focus on analysis, but professionals operate in a three dimensional space. They are aware of trading psychology their own feelings and the mass psychology of the markets.” – Alexander Elder

Green lines are resistance, Red lines are support.

EUR/USD
Pivot: 1.069
Likely scenario: Short positions below 1.069 with targets @ 1.0625 & 1.06 in extension.
Alternative scenario: Above 1.069 look for further upside with 1.0725 & 1.077 as targets.
Comment: The RSI lacks upward momentum.

GBP/USD
Pivot: 1.524
Likely scenario: Short positions below 1.524 with targets @ 1.514 & 1.5095 in extension.
Alternative scenario: Above 1.524 look for further upside with 1.5275 & 1.531 as targets.
Comment: The RSI lacks upward momentum.

AUD/USD
Pivot: 0.707
Likely scenario: Long positions above 0.707 with targets @ 0.715 & 0.717 in extension.
Alternative scenario: Below 0.707 look for further downside with 0.704 & 0.7015 as targets.
Comment: Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.

USD/JPY
Pivot: 123
Likely scenario: Long positions above 123 with targets @ 123.6 & 124 in extension.
Alternative scenario: Below 123 look for further downside with 122.6 & 122.35 as targets.
Comment: The RSI lacks downward momentum.

USD/CAD
Pivot: 1.329
Likely scenario: Long positions above 1.329 with targets @ 1.335 & 1.338 in extension.
Alternative scenario: Below 1.329 look for further downside with 1.3265 & 1.3225 as targets.
Comment: The RSI lacks downward momentum.

USD/CHF
Pivot: 1.012
Likely scenario: Long positions above 1.012 with targets @ 1.0175 & 1.021 in extension.
Alternative scenario: Below 1.012 look for further downside with 1.0075 & 1.004 as targets.
Comment: The RSI is mixed to bullish.

GOLD
Pivot: 1076
Likely scenario: Short positions below 1076 with targets @ 1064 & 1059 in extension.
Alternative scenario: Above 1076 look for further upside with 1082 & 1087 as targets.
Comment: As long as 1076 is resistance, likely decline to 1064.

OIL
Pivot: 42.25
Likely scenario: Short positions below 42.25 with targets @ 40 & 39.2 in extension.
Alternative scenario: Above 42.25 look for further upside with 43.3 & 44.12 as targets.
Comment: As long as 42.25 is resistance, likely decline to 40.

DAX
Pivot: 10765
Likely scenario: Long positions above 10765 with targets @ 11000 & 11060 in extension.
Alternative scenario: Below 10765 look for further downside with 10675 & 10600 as targets.
Comment: The RSI is bullish and calls for further advance.

TIME IS IN GMT(+3)

Report prepared by the easy-forex VIP desk at 06:20 GMT.

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