After hitting the significant 200-day SMA at 1.1281 level on July 18, the Fiber took a rebound price action, heading to the south. Even today, the EUR/USD pair kept plunging and hardly saw any upside. The tumbling rally consisted of multiple Doji candlesticks, showing a continuation of the downtrend. However, a move to the upside would have enabled the pair to challenge the overhead significant SMA conflux.
On the economic docket, the downbeat outcome of the two significant high volatile events disappointed market participants. One among the duo was the German July Markit Manufacturing PMI which reported 4.88% drop over 45.2 points estimates. The other one was the Eurozone July Markit PMI Composite which came out 1.17% below the market hopes of around 52.1 points. Also, while moving downwards, the EUR/USD pair breached away the healthy 1.1193 and 1.1182 support handles.
An overhead strong resistance conflux continued to put a lid over the Cable’s gains even today. This conflux consisted of a 1-month old descending slanting resistance and 100-day medium-term SMA.
After showcasing some adverse price actions last day, the GBP/USD pair ensured to take the flight to recovery today. Today, Boris Johnson took charge of the office as the new UK Prime Minister. Boris was put under pressure on his first day as the PM by both Donald Tusk and Michel Barnier to explain his Brexit plan “in detail“. Britishers continue to stay tensed, fearing a hard Brexit in the near term. The RSI was indicating 60.68 level, revealing an almost overbought condition.
The Greenback ensured to keep the daily volatility within the vicinity formed by 2:1 and 3:1 Gann lines. Hence, the uptrend remained intact in the overall price actions of the USD Index. Though there occurred a slight downfall in the initial hours of the day, the Greenback bulls managed to recover those early morning losses laterwards. Both the July US Markit Manufacturing PMI and PMI Composite missed estimates. Also, the June MoM New Home Sales came around 0.646 million over the market hopes of 0.660 million. Despite that, the July Markit Services PMI recorded 0.97% higher than the consensus estimates of about 51.7 points. If at all, the USD Index made a move to the downside, then the market attention would have turned over to the below-lying significant SMAs. The histograms of the Moving Average Convergence Divergence (MACD) kept pointing to the north, bestowing positive drifts in the Greenback.
The Japanese yen pair had bounced off 107.20 support on July 18, taking the upward path towards recovery. However, after reaching the 108.20 resistance mark, last day, the pair made a downturn. Today, the Ninja was underway the same slump rally, touching 107.96 level. Quite notably, the pair kept on moving in and out of the significant SMAs. The pair remained stuck between the 200-day SMA and the 50-day SMA in the late afternoon session.
Earlier the day, the Japanese May Leading Economic Index reported 94.9 points over 95.2 points forecasts. However, the May Coincidence Index came out 0.19% higher than the market expectation of around 103.2 points. If the pair had broken and moved above the 108.12 level, then that would have activated the resistance stalled near 108.35 level.
This article was originally posted on FX Empire
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