Daily Market Analysis By FXOpen

Market Analysis: The US Dollar Rises on Strong Data


Investors are assessing the August report on consumer prices in the US, which was published the day before and caused a muted market reaction. Thus, the index increased by 0.6% over the month after 0.2% in the previous period, which resulted in an increase in the annual indicator to 3.7% from 3.2% previously. The benchmark index, which US Federal Reserve officials rely on when setting monetary policy, adjusted to 4.3% from 4.7% previously, the lowest reading since October 2021, when it first reached 4.0%. Against this background, experts’ confidence in maintaining the interest rate at 5.25–5.50% at the US Federal Reserve meeting on September 19-20 even increased and, according to the FedWatch Tool indicator from the Chicago Mercantile Exchange (CME), now amounts to more than 97.0 %.

EUR/USD

The European currency fell against the US dollar on Thursday as the euro came under pressure after the European Central Bank signaled an end to its rate hike cycle. The ECB raised interest rates at its 10th straight meeting on Thursday to combat persistent inflation but signaled it was likely to ease policy. The central bank of the 20 countries that use the euro raised its deposit rate to 4% from 3.75%, bringing it to a record high level. Markets and economists expect policy tightening to be the ECB's final move and now expect a long pause followed by rate cuts in the second half of next year. The euro fell 0.89% to 1.0635 after falling to 1.0629, its weakest since March 17 and on pace for its biggest one-day percentage drop since July 27. Immediate resistance can be seen at 1.0711, a breakout to the upside could trigger a rally to 1.0740. On the downside, immediate support is seen at 1.0630, a break below could take the pair towards 1.0594.

Over the past week, a price range has formed with boundaries of $1.0685 and $1.0748. Now the price has moved to the upper half of the range and may continue to rise.



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• GBP/USD analysis: Price sets a minimum of 3 months after GDP news
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GBP/USD Extends Losses While EUR/GBP Gains Strength


GBP/USD extended losses and traded below the 1.2465 support. EUR/GBP is rising and might climb above the 0.8615 resistance.

Important Takeaways for GBP/USD and EUR/GBP Analysis Today

• The British Pound is showing bearish signs below 1.2420.
• There is a key bearish trend line forming with resistance near 1.2465 on the hourly chart of GBP/USD at FXOpen.
• EUR/GBP is rising and trading above the 0.8600 zone.
• There was a break above a connecting bearish trend line with resistance near 0.8600 on the hourly chart at FXOpen.

GBP/USD Technical Analysis


On the hourly chart of GBP/USD at FXOpen, the pair attempted a fresh increase above 1.2500. However, the British Pound failed above 1.2540 and started a fresh decline against the US Dollar.

There was a clear move below the 1.2465 support and the 50-hour simple moving average. The pair even tested the 1.2380 support zone. A low was formed near 1.2378 and the pair is now consolidating losses.

On the upside, the GBP/USD chart indicates that the pair is facing resistance near the 23.6% Fib retracement level of the downward move from the 1.2548 swing high to the 1.2378 low at 1.2420 and the 50-hour simple moving average.

The next major resistance is near a bearish trend line at 1.2465. It is close to the 50% Fib retracement level of the downward move from the 1.2548 swing high to the 1.2378 low.

A close above the 1.2465 resistance zone could open the doors for a move toward 1.2510. Any more gains might send GBP/USD toward 1.2545. On the downside, there is a key support forming near 1.2380. If there is a downside break below the 1.2380 support, the pair could accelerate lower.

The next major support is near the 1.2320 zone, below which the pair could test 1.2250. Any more losses could lead the pair toward the 1.2200 support.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

USD/CAD Analysis: Canadian Dollar Strengthens Ahead of Inflation News


On September 7, we wrote that the level of 1.365 could serve as resistance, from which the price will form a bearish reversal.

As the USD/CAD chart shows, the rate dropped from this resistance to the psychological level of 1.3500, which served as support.

Wherein:

→ The bullish trend (shown by the blue channel) is broken. Facing resistance at 1.365, the bulls failed to reach the upper boundary of the channel, which was a sign of weakening uptrend. One could also observe bearish divergences on a number of indicators.

→ The price at the beginning of the week is in a downward trend, which is shown by the red channel.



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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Euro vs Turkish Lira: A Tale of Turbulence and Opportunity


As the summer holiday season drew to a close approximately two weeks ago, tourists from across the globe bid farewell to Turkey, a nation known for its captivating landscapes, rich history, and hospitality.

For decades, Turkey has been a favoured destination for travellers from Europe, the Caucasus, the Middle East, and Eurasia. Its vibrant tourist industry, catering to package tours and all-inclusive hotels, has consistently offered families and working individuals a few weeks of relaxation at an affordable price. However, beneath this veneer of holiday bliss, Turkey's economy has grappled with a persistent challenge – the devaluation of the Turkish Lira.

The Lira's Downward Spiral

Over the past six years, the Turkish Lira has been on a rocky path, depreciating significantly against major global currencies.

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Us Dollar Weakens ahead of the Fed Meeting


EUR/USD

The euro rose against the US dollar on Friday, boosted by hopes that the ECB is ending its cycle of rate hikes and data suggesting China's faltering economy may be regaining some momentum. The ECB raised its key interest rate to a record 4% on Thursday and warned it would remain at that level until inflation above target is resolved. Data on Friday showed Chinese retail sales and industrial production figures for August beat economists' expectations, even as the housing market slump deepened. The euro rose 0.2% to $1.0675, off a low of $1.0632, its weakest since March 20. Immediate resistance can be seen at $1.0710, a break higher could trigger a rise towards $1.0760. On the upside, immediate support is seen at 1.0637, a break below could take the pair towards 1.0592.

Based on last week's lows, a new downward channel has formed. Now, the price is in the middle of the channel and may continue to rise.



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S&P 500 under Pressure ahead of Federal Reserve Meeting


The decision on the base interest rate will be published tomorrow at 21:00 GMT+3, and Powell will hold a press conference at 21:30. Although most experts, as reported by the media, expect that the current rate will remain, market participants will closely monitor the Federal Reserve's assessment of the current situation, which includes new data on inflation and the labour market. It is possible that there will be another rate increase before the end of the year.

Meanwhile, the S&P 500 chart shows the market under pressure in mid-September, although the overall picture appears balanced.

The balance of supply and demand is indicated by the fact that the movement B→C is approximately 50% of the movement A→B. And the C→D movement is approximately 50% of the B→C movement. That is, fluctuations die out as buyers and sellers converge.

The price is still within the ascending channel (shown in blue), but it is possible that during tomorrow's news announcement from the Federal Reserve there will be an attempt by the bears to break through it.



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Cryptocurrency Prices Rise on SEC Rumours


Various media outlets report the opinion that SEC Chairman Gary Gensler expressed in a personal conversation. He allegedly intends to approve applications for the creation of ETFs related to the cryptocurrency spot markets. Such applications were submitted by BlackRock, Invesco, WisdomTree, Valkyrie and other respectable funds. But for now, the SEC's decision on the applications has been delayed.

At the same time, it is reported that by giving the go-ahead to applications, Gary Gensler can thereby gain loyalty from the funds, and after the end of his period as head of the SEC, go to work for one of them.

Against the backdrop of the information mentioned, the crypto markets perked up — the prices of bitcoin, Ether and other assets rose by approximately 3% in a few hours. However, it is unlikely that such rumors can become a driver for creating a sustainable trend.



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Yen and European Currencies Retreat from Previously Reached Lows


Last week, European currencies renewed their recent lows, while the yen and commodity currencies managed to remain in their old ranges. However, this week, everything can change dramatically since the fundamental data of the coming trading sessions is as saturated as possible. Data on the consumer price index in the Eurozone will be released today, and tomorrow, a similar index will be published in the UK. Also, central banks in the US and UK will announce their interest rate decisions on Wednesday and Thursday.

USD/JPY

The dollar/yen currency pair is stuck between 146 and 148. After a sharp rise in early September, the price switched to sideways movement and, apparently, is accumulating strength for growth. If greenback buyers manage to gain a foothold above 147.80, the start of a new upward impulse towards last year's highs at 150.00-151.00 may occur. However, if we see a sharp pullback from the current levels or there is a false breakout at 148.00-150.00, a full-scale downward correction may happen.

The pair's pricing will depend almost entirely on tomorrow's Fed verdict (21:00 GMT+3). If a pause in the hawkish policy of the American regulator is announced, USD/JPY could instantly be at 144.00-145.00. If officials declare the need to further increase the rate, a test at 150 may occur.



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EUR/USD Faces Hurdles While USD/JPY Eyes Breakout


EUR/USD started a fresh decline below 1.0715. USD/JPY is rising and might climb further if it clears the 148.00 resistance zone.

Important Takeaways for EUR/USD and USD/JPY Analysis Today

• The Euro started a fresh decline below the 1.0715 support zone.
• There is a key bearish trend line forming with resistance near 1.0715 on the hourly chart of EUR/USD at FXOpen.
• USD/JPY climbed higher above the 147.20 and 147.50 levels.
• There is a connecting bullish trend line forming with support near 147.70 on the hourly chart at FXOpen.

EUR/USD Technical Analysis


On the hourly chart of EUR/USD at FXOpen, the pair started a fresh decline from the 1.0760 zone. The Euro declined below the 1.0715 support zone against the US Dollar.

The pair even settled below the 1.0680 zone and the 50-hour simple moving average. A low is formed near 1.0632 and the pair is now attempting a recovery wave above the 50% Fib retracement level of the downward move from the 1.0764 swing high to the 1.0632 low.

On the upside, the pair is now facing resistance near 1.0715 and a key bearish trend line. It is close to the 61.8% Fib retracement level of the downward move from the 1.0764 swing high to the 1.0632 low.

The next major resistance is near 1.0760. The main resistance is now near 1.0780. An upside break above 1.0780 could set the pace for another increase. In the stated case, the pair might rise toward 1.0840.

If not, the pair might resume its decline. The first major support on the EUR/USD chart is near 1.0680. The next key support is at 1.0655. If there is a downside break below 1.0655, the pair could drop toward 1.0630. The next support is near 1.0600, below which the pair could start a major decline.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.