Market Forecast 04/10/2017
The Euro is under pressure and testing an important support vs the Japanese Yen. GBP/JPY is also in the bearish territory and might continue to slide towards 149.00.
EUR/JPY Forecast – Euro testing Crucial Support
- The Euro after trading above 133.00 against the Japanese Yen found sellers and declined.
- The EURJPY pair is currently testing a major bullish trend line with support at 132.25 on the hourly chart.
- Today in the Euro Zone, the PMI service for Sep 2017 was released by the Markit Economics.
- The outcome was above the forecast of 55.6, as there was a rise from 55.6 to 55.8.
The Euro traded above the 133.00 level recently against the Japanese Yen, but failed to hold on to gains. The EUR/JPY pair started a downside move after trading as high as 133.10 and moved below the 132.80 support area along with the 100 hourly simple moving average.
The pair recently broke the 132.50 support and tested a major bullish trend line with support at 132.25 on the hourly chart.
It might attempt a correction, but most likely to struggle near the 38.2% Fib retracement level of the last decline from the 132.87 high to 132.24 low. There is also a bearish trend line on the upside at 132.70 to stop the upside move.
An intermediate resistance is near 132.60, the 100 hourly simple moving average and the 61.8% Fib retracement level of the last decline from the 132.87 high to 132.24 low.
Overall, selling rallies close to the 132.50-60 levels can be considered in the short term with a stop above the trend line resistance.
Euro Zone Services PMI
Today, the Euro Zone saw the release of the PMI service for Sep 2017 by the Markit Economics. The forecast was slated for no change from the last reading of 55.6.
The actual result was above the forecast of 55.6, as there was a rise from 55.6 to 55.8. On the other hand, the German Services PMI remained at 55.6, but both registered readings well above the expansion levels.
Moreover, the Spanish Purchasing Managers Index (PMI) Services gained from 56.0 to 56.7, which is a good sign for the economy.
GBP/JPY Forecast – British Pound Could Extend Declines
- The British Pound is in a declining streak and is trading below 150.00 against the US Dollar.
- There is a crucial bearish trend line forming with resistance near 146.70 on the hourly chart of GBP/JPY.
The British Pound started a major downtrend from the 151.50 swing high against the US Dollar. The GBP/JPY pair declined and broke the 150.00 and 149.80 support levels to trade as low as 149.02.
The pair is currently correcting higher, but facing a crucial bearish trend line forming with resistance near 146.70 on the hourly chart.
Moreover, the 50% Fib retracement level of the last decline from the drop from the 150.22 high to 149.02 low is also near 149.62 to act as a resistance.
Overall, selling rallies close to the 149.70 level can be considered with a stop above the trend line.
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