Market Forecast 02/10/2017
Euro is moving higher versus the British Pound and EUR/GBP might soon retest 0.8840. USD/CAD is approaching a crucial upside break above 1.2530.
EUR/GBP Forecast – Euro to Retest 0.8840?
- The Euro is recovering and is currently trading above the 0.8800 level against the British Pound.
- There is an expanding triangle forming with resistance near 0.8860 on the hourly chart of the EUR/GBP pair.
- Today, the UK’s Manufacturing Purchasing Managers Index (PMI) for Sep 2017 was released by both the Chartered Institute of Purchasing & Supply and the Markit Economics.
- The forecast was 56.4, but there was a decline in the PMI from 56.9 to 55.9.
The Euro recently traded close to the 0.8840 level against the British Pound. The EUR/GBP pair failed to gain pace above 0.8840 and started a short-term correction.
The pair moved below the 23.6% Fib retracement level of the last wave from the 0.8758 low to 0.8840 high. However, the downside move was protected by the 0.8800 level and the 38.2% Fib retracement level of the last wave from the 0.8758 low to 0.8840 high.
The pair is once again moving higher and forming an expanding triangle with resistance near 0.8860 on the hourly chart. It seems like the pair might continue to rise and could even break 0.8840 if buyers remain in action.
UK’s Manufacturing PMI
Today in the UK, the Manufacturing Purchasing Managers Index (PMI) for Sep 2017 was released by both the Chartered Institute of Purchasing & Supply and the Markit Economics. The forecast was slated for the PMI to decline from 56.9 to 56.4.
The actual result was below the forecast, as there was a decline in the PMI from 56.9 to 55.9. However, the reading is still well above 50 and suggest solid growth of output, new orders and employment in Sep 2017.
Also, the current PMI at 55.9 is well above its long-run average of 51.7. The EUR/GBP was not impacted much, and the pair might soon continue to trade higher towards 0.8840.
USD/CAD Forecast – US Dollar Eyeing Upside Break Vs Canadian Dollar
- The US Dollar is following a solid uptrend above 1.2440 against the Canadian Dollar.
- There is a monster bullish trend line with support at 1.2455 forming on the hourly chart of the USD/CAD pair.
The US Dollar started a major uptrend from the 1.2260 swing low against the Canadian Dollar. The USD/CAD pair has moved higher by more than 200 pips and breached a few important resistances like 1.2300, 1.2400, 1.2440 and 100 hourly simple moving average.
At the moment, the pair is attempting a break of the 1.2520-30 resistance, which is a strong barrier for more gains. On the downside, there is a monster bullish trend line with support at 1.2455 forming on the hourly chart, which can be seen as a buy zone.
As long as the pair is above the trend line support at 1.2560, it might continue to move higher. The next resistance insight is around 1.2580.
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