Forex Signals Brief for September 11th: Will the USD Continue to Tumble?
Rowan Crosby • 3 min read
Morning Guys and Girls,
The story last week ended up being the downfall of the Greenback. It started its decline early and, by the end of trade on Friday, the dollar index closed down 1.6%. As I spoke about on Friday, it appeared that there were a lot of traders around that wanted to be hedged going into the weekend, with fears over North Korea and the then imminent Hurricane Irma. That put some weakness into the USD and the momentum continued to build.
In Asian trade we’ve seen the start of a retrace in the safe haven assets. Both the USD/JPY, the USD/CHF and Gold have all started to work their way back, however, I’m still feeling a little bit bearish on the USD as we start the trading week.
This week might be the chance to find some good technical setups after last week which was very much dominated by the news and central banks.
Top Economic Events Today
It’s a quiet day on the economic calendar to start the week, with not much that should have an impact in early trade.
EUR – ECBs Cœuré Speaks
Benoît Cœuré is speaking in Germany at 7:00 GMT. His speech is entitled "Monetary Policy in non-Standard Times".
EUR – Italian Industrial Production
Italian Industrial Production is due for release at 8:00 GMT, and analysts are predicting a lower result than the previous month. I don’t expect this to be a market moving event for the Euro.
EUR/USD – Continuing the Rally
Last week was a huge one for the Euro. On the back of the ECB and Mario Draghi, the EUR/USD rallied strongly and took out the recent highs, despite the key issue of QE tapering being pushed back.
With the underlying weakness in the USD at the moment, it seems like we should be looking for good opportunities to buy pullbacks in the Euro.
EUR/USD – 240 min Chart
EUR/USD – Trading Plan
Given the momentum and the weak USD, I’m looking for opportunities to buy. There’s been a solid trendline on the 240-min chart that has been holding strong, and price is really tracking it. I want to buy near the trendline which would be around 1.1950.
Gold – Safe Havens Backing Off
Last week the safe havens spiked, and they didn’t slow down all week. Gold gapped higher on Monday after the North Korean hydrogen bomb scare rattled markets, and it didn’t really pull back. In early Asian trade this week, it looks like we’ve got a bit of a retrace on our hands, and it looks like it could be a good opportunity.
Gold – 240 min Chart
Gold – Trading Plan
I’m looking to buy any weakness in gold this week. We are still on the edge with North Korea, and there is the opportunity for another test of the highs. Should any more news hit the wires I think it won’t take very much at all to bring the buyers screaming back in.
For the time being I want to be buying in the 1325-1330 area.
Like I mentioned earlier, I think this might be a great week for some techincal setups and key levels. Last week was a big one on the news front and, after a lot of action, price sometimes likes to find its feet early in the week. That said, with the recent strength in safe havens, any little headline might be enough to spark markets.
So make sure you keep your trigger finger at the ready, or at the very least pay close attention to our analysts who will be across all the big events in forex markets.
Have a great week guys!