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UFXBank Forex Outlook: Euro Extends Gains on USD

Written by UFXBank Research Team
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USD Dollar (USD) – The dollar continued to slump across the board in Forex Trading, following the FED's statement suggesting a further easing of monetary policy is in the works in order to help support the weakening economy. Stock Markets closed negative with the Dow Jones losing 0.2% and the NASDAQ falling by 0.63%. Crude Oil weakened by 0.3% and closed at $74.70 a barrel. Gold (XAU) traded at record high levels after it jumped by 1.4% and closed at $1292 an ounce. Today, the Initial Jobless Claims report is expected unchanged at 450K. The Existing Home Sales are expected at 4.04M vs. 3.83M previously.

EURO (EUR) – The Euro extended its rally against the dollar and reached a 5 month high. The Industrial New Orders, which came out at -2.4% - worse than the expected -1.2%, could not stop the positive wave in the euro. Breaching the 1.3440 resistance level might push the pair higher. Overall, EUR/USD traded with a low of 1.3246 and with a high of 1.3440. Today, the German Manufacturing PMI is expected at 57.8 vs. 58.2 previously. The Manufacturing PMI is expected at 54.6 vs. 55.1 previously.

EUR/USD – Last: 1.3394

Resistance

1.3440

Support

1.3360

1.3305

1.3240

British Pound (GBP) – The Pound gained versus the dollar following the main trend of dollar weakness in the markets, although it is not accelerating as strong as other currencies and it is still capped by sell orders that keep the pair below the 1.57 zone. Breaching the 1.5730 resistance level might push the pair higher. Overall, GBP/USD traded with a low of 1.5600 and with a high of 1.5714. Today, the BBA Mortgage Approvals are expected at 32.3K vs. 33.7k previously.

GBP/USD - Last: 1.5650

Resistance

1.5685

1.5730

Support

1.5600

1.5500


Japanese Yen (JPY) – The Yen gained versus the dollar for a second day but still the USD/JPY pair trading firmly above from its 15 year low level around the 83 zone. Trading above the support level of 83.80 keeps the momentum positive for the pair. Overall, USD/JPY traded with a low of 84.25 and with a high of 85.17. Today, Japanese banks will be closed in observance of Autumnal Equinox Day.

USD/JPY-Last: 84.62

Resistance

84.70

85.25

85.90 

Support

84.30

83.80

Canadian dollar (CAD) – Canada’s dollar managed to gain at the end of the day versus the U.S. dollar despite the disappointing macro data as the Core Retail Sales came out -0.4% worse than expected 0.5% and the Leading Index came out 0.5% worse than expected 0.6%. Holding above the support level of 1.0220 levels keeps the momentum positive for the pair. Overall, USD/CAD traded with a low of 1.0283 and with a high of 1.0344. No economic data is expected today.

USD/CAD - Last: 1.0295

Resistance

1.0320

1.0350


Support

1.0270

1.0220