Forex Signals US Session Brief, August 16th – USD Still Undecided! Recuperating Before the Next Attack? - Forex News by FX Leaders

Forex Signals US Session Brief, August 16th – USD Still Undecided! Recuperating Before the Next Attack?

Posted Wednesday, August 16, 2017 by
Skerdian Meta • 3 min read

Today the US Dollar has been trading mostly sideways, gaining against some currencies such as USD/JPY, while losing some ground against others. Although, this seems more like the USD buyers recuperating before the next attack. Let´s have a look at pairs and forex events to see where the market stands right now and what opportunities lie ahead for forex traders.

Are USD bulls getting ready for the next move higher?

GBP Jumps After UK Employment report, But Is This Sustainable?

The UK employment report offered the market a surprise as the unemployment rate declined to 4.4% and the unemployment claims fell. Most importantly the average earnings jumped to 2.1% from 1.8% previously, which was also revised higher to 1.9%.

All numbers were positive, making this the first positive report in a few months and the GBOP go excited for a minute there. It jumped about 60 pips but it stalled a few pips short of the 50 SMA on the hourly forex chart, which coincides with the 200 SMA on the H4 chart that we highlighted in the previous forex update.

Personally, I don’t see this move higher as sustainable, even though the support at 1.2840-50 still remains intact and the daily forex chart is also overbought. However, the weekly chart is still pointing down strongly as we said in the first forex update today. The trade idea for this pair is posted below.

Trades in Sight

There are a few chart setups (as we have shown on the charts above and below) which have gotten our attention, particularly the GBNP/USD which we already highlighted in the previous update and NZD/USD.

We have already taken the trade in NZD/USD and at the moment it doesn’t look bad. We decided to sell this forex pair instead of AUD/USD because the retrace higher in AUD/USD this morning has been pretty strong, while the pullback in NZD/USD has been quite minimal. This suggests that this pair is still weak and it has more chances than the Aussie to reverse lower, according to the price action strategy.

Sell GBP/USD

  1. The trend has been heading down all month
  2. The jump higher has stalled
  3. The previous H1 candlestick looks bearish
  4. H1 chart is almost overbought (stochastic)
  5. Fundamentally, the GBP is very bearish

Buy EUR/CHF

  1. The bigger trend is up and it is pretty strong
  2. The retrace seems over on the H1 chart since it is oversold
  3. The 100 simple and smooth MAs are providing support and holding the decline
  4. The 100 SMA on the H4 chart is standing 20 lower, which will provide additional support in case we slip down there
  5. The previous H1 Candlestick formed a pin which is a reversing signal
The hourly chart setup looks bullish 

Sell NZD/USD

  1. The previous support at 0.7250 has now turned into resistance
  2. The trend has been down since late July
  3. The H1 chart is oversold
The previous support level is now turning into resistance

We might not take all the trades we have highlighted here because we don’t want to be too exposed considering we already have a couple of trades open. You can decide which pair to trade according to your money management strategy and your risk appetite.

US Building Permits & Housing Starts

In a short while the US construction report, which includes the retail sales and housing starts, will be released. Although this data appears as red and orange on the economic calendar, which means that it is pretty important, this is not a big market mover.

However, that´s if the numbers don’t deviate too much from the general consensus. They´re expected to be around 1.25 and 1.22 million this month respectively.

That´s pretty close to last month’s reading, so these numbers won´t get much action. If the numbers come above 1.30 million or below 1.10 million, then that will shake the markets a bit.

Perhaps the US traders will give us some direction as well when they enter the market shortly after the construction report is released. So far this morning has the market running up and down in a tight range like a headless chicken.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies

About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
Related Articles
The [[WTI]] crude oil prices managed to extend its bullish overnight rally and hit the intra-day high level around above mid-$42.00, mainly
15 hours ago
Comments

Leave a Reply

avatar
  Subscribe  
Notify of