New levels have come in play today
Skerdian Meta • 2 min read
Yesterday the US employment figures were pretty solid, as this sector of the economy has shown for quite some time now. But the manufacturing data for August sucked pretty bad. It declined nearly three points and at 49.4 it fell in contraction. Just when you expect the US manufacturing sector to pick up it slides into contraction and when you expect the UK manufacturing sector to continue its contraction it makes a record jump of more than four points, go figure.
The US construction spending for July also disappointed so the Buck (USD) got a beating as my colleague Eric wrote on his last post yesterday evening. That has changed the closest support and resistance levels in some of the major forex pairs so let´s have a look at the new levels today and see if we find any good opportunities to open one or two forex signals with this support and resistance levels as risk defining areas.
The two moving averages seem insuperable
EUR/USD – This forex pair kept sliding since Friday last week after Yellen´s comments at the Jackson Hole. But ion the last three days the 1.1120-30 level has kept the price from falling further, so this is the first support level. Below that comes 1.11 where the 50 simple moving average (SMA) stands on the weekly chart and then 1.1050. The first resistance is provided by the 100 and 200 moving averages which stand at 1.1100-10 which topped the up move yesterday, as you can see from the forex chart above. 1.1230-40 is where the 100 SMA stands in the H4 forex chart so that´s the second resistance level with the third being around 1.1260.
USD/JPY – Now, this forex pair has made some nice advancement on the upper side, which is impressive knowing that it was so biased on the downside. It made a quick dip yesterday at the 50 SMA on the H1 forex chart after the miss in the US economic data. We saw that as a good opportunity to open a buy forex signal which hit the take profit level this morning, so that SMA is the first support at 103.30-40. Below comes 103.10 which was the low yesterday. The first resistance is provided by the long term downtrend line at 103.80 and then comes yesterday´s high at 104. 105.40-50 is clearly a big level to take out and the 100 SMA in the daily forex chart will add extra strength to it.