USDCHF attempts a rebound
FOREX.com September 1, 2020 12:22 PM
The long term bearish trend remains, but for how long?
The US Dollar was bullish against most of its major pairs on Tuesday with the exception of the NZD and GBP. On the US economic data front, Markit's US Manufacturing Purchasing Managers' Index declined to 53.1 on month in the August final reading (53.6 expected), from 53.6 in the August preliminary reading. Construction Spending rose 0.1% on month in July (1.0% expected), from a revised -0.5% in June.
On Wednesday, the Mortgage Bankers Association's Mortgage Applications data for the week ending August 28th is expected. Automatic Data Processing's Employment Change for August is expected to spike to 1,000K on month, from 167K in July. Factory Orders for July are expected to rise 6.1% on month, compared to +6.2% in June. Durable Goods Orders for the July final reading are expected to remain at 11.2% on month, in line with the July preliminary reading. Finally, the Federal Reserve's Beige Book is expected to be released.
The Euro was bearish against most of its major pairs with the exception of the CHF. In Europe, German Government has revised its 2020 GDP forecast to -5.8%, vs -6.3% previously. It also revised its 2021 GDP forecast to +4.4%, vs +5.2%. Research firm Markit has published final readings of August Manufacturing PMI for the Eurozone at 51.7 (as expected), for Germany at 52.2 (vs 53.0 expected), for France at 49.8 (vs 49.0 expected) and for the U.K. at 55.2 (vs 55.3 expected). The European Commission has posted August CPI at -0.2% (vs +0.2% on year expected) and July jobless rate at 7.9% (vs 8.0% expected). The German Federal Statistical Office has reported August jobless rate at 6.4%, as expected. The Bank of England has released the number of mortgage approvals for July at 66,300 (vs 55,500 expected).
The Australian dollar was bearish against most of its major pairs with the exception of the CAD, CHF and EUR.
The FX pair with the largest move on Tuesday was the USD/CHF which jumped 58 pips to 0.9095 the day's range was 0.8999 - 0.9101. Looking at the chart, the longer term trend remains bearish. Today's action has helped identify a key support threshold at the $0.899 level. A break above key resistance at 0.9185 will have to be confirmed in order to play a rebound with a goal of breaking above the 50-day moving average. A new short signal would be confirmed with a break of 0.899 support.
Source: GAIN Capital, TradingView
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.