Fundamentals
On Monday, the dollar index extended friday's pullback, diving down to the 93.45 line, and then stabilized higher to test the downside 10-day moving average. However, the non-US trend is differentiated. Driven by good market sentiment, risk currencies remained firm, commodity currencies remained high, closing slightly higher except for the Canadian dollar; the pound was close to closing, further signaling a reversal to the downside; and the yen weakened slightly, still expected to restart the decline. The euro maintained a high negative correlation with the US dollar, pulling back more than 60 points from the rebound highs, testing the 1.1600 line. However, gold, which may be driven by inflation expectations, did not weaken due to the higher dollar and good market sentiment, but instead stabilized above 1790, once again rushing above 1800, with a high of 1809.90, but still below the high of the upper shadow line on Friday.
There are also traces of the trend of major currencies overnight from the perspective of monetary policy prospects and fundamentals of various countries. Several major currencies that fell overnight, the Yen, the Euro and the Canadian Dollar, will convene interest rate decisions this week, in which the market's expectation for the Bank of Japan and the European Central Bank is to maintain easing or even increase easing, and the decline in currencies reflects this expectation of the market to some extent. Market expectations for a RATE HIKE by the BOC are high, but at this week's meeting, the CBOC may only continue to cut the pace of QE step by step, so the market has made an early layout that the CBO may not be as hawkish as the market expects.
In contrast, judging from Fed Chairman Powell's hints at interest rate hikes on Friday, the market's expectations for a Fed rate hike may be insufficient. This round of dollar correction, one is that Taper is about to cash in on the profit-taking push made by the bulls, and the other is that the market has over-interpreted the narrowing or disappearance of the Fed's interest rate hike lead. However, the dollar is only stabilizing and rebounding, and there is not enough momentum to promote the dollar to continue to rise, and good market sentiment is still a roadblock to the upside of the dollar.
Lack of news during the day, with a slight focus on the US October Consultative Chamber Consumer Confidence Index.
Technical
EUR/USD
The daily ma5/10 crosses downwards, and the stochastic indicator tends to continue to move lower, focusing on the support of the 20-day moving average. The 4-hour chart was blocked below 1.1670, with the big yin line falling back to break the consolidation range to support near 1.1615, and then maintained below the level of consolidation, still inclined to continue to the downside. After a continuous and rapid decline on the hourly chart, it is weakly consolidated at the low level. Intraday advice to operate cautiously, slightly inclined to short the 1.1620 line, below the 1.1590 follow-up.
Support level : 1.1590 1.1570 1.1540
Resistance: 1.1620 1.1640 1.1665
GBP/USD
The daily chart was blocked above 1.3830 for two consecutive days, and then the doji was recorded, further signaling a reversal, and the stochastic indicator tended to move further lower, possibly returning below the downtrend line since the July highs. The 4-hour chart has limited volatility, and the short-term moving average provides pressure and is inclined to continue to decline. Hourly chart oscillation downside test MA200, a break down will hopefully open a bigger drawdown. Intraday recommendations are short below 1.3790 and follow up below 1.3740.
Support: 1.3740 1.3700 1.3670
Resistance: 1.3790 1.3815 1.3835
USD/JPY
The daily stochastic tends to recover from the oversold zone, but the rally is still weighed down by the 10-day moving average. The downward pressure on the 4-hour chart eased, but the bulls' momentum was not strong. The hourly chart breaks sideways through the short-term downtrend line, focusing on whether it can stabilize above the line. Intraday recommendation 113.70 line to do long, first look at 114.00.
Support: 113.70 113.40 113.20
Resistance: 114.00 114.20 114.40
gold
The daily chart closed higher for 5 consecutive days, and the rally momentum since the end of September remained intact, but the stochastic indicator bear diverged and remained cautious about further upside. The 4-hour chart remains upside, focusing on whether it can recover the long upper shadow highs. The hourly chart oscillated higher, but there were signs of resistance below the previous highs. Intraday caution is recommended, with activists seeking to go short below 1810 and follow up if it breaks below 1800.
Support level: 1800 1792 1785
Resistance: 1810 1815 1820
silver
The short-term moving average of the daily chart continues to provide support upwards, but the long upper shadow line and the bear divergence of the stochastic indicator should be wary of the risk of a pullback. The 4-hour chart oscillated slightly higher, but still failed to recover the ground lost on the previous shadow line, and the stochastic indicator bear diverged. The hourly chart is moderately higher, and the upward momentum is slowing down. Intraday caution is advised, with activists seeking to go short below 24.60 and follow up below 24.30.
Support: 24.30 24.00 23.60
Resistance: 24.60 24.80 25.00
This article originated from the Financial Circle Network