EURUSD, GBPUSD, NZDUSD Dollar recovery reduces optimism
If we look at the EURUSD chart on the four hour timeframe, we see that the pair is still moving in the falling channel, pushing the MA50 and MA200 moving averages. The EURUSD pair also hit a fresh low at 1.16800 yesterday but failed to hit a new lower low and fell below the 1.16630 low from the second August period. Going below this lows will lead us to new lower levels and our first target is 1.16000. For the bullish scenario, we need better support on the chart and for now we have it in the MA20 moving average. Further positive consolidation could lead us to an upper resistance level around the 1.18000 zone. The break above this resistance line takes us to the previous high at 1.19000 and the continuation above the door makes us optimistic that we have returned to the bullish trend.
GBPUSD chart analysis
If we look at the GBUPSD chart on the four hour timeframe, we see that we have resistance at the 38.2% Fibonacci level at 1.37470. We can first look for possible support at the 23.6% Fibonacci level at 1.36900 with the added support for the MA20 moving averages. If the pair does not find support, there is a high possibility that we will retest the previous low at 1.36100. For the bullish scenario, we need positive consolidation that would push the EURUSD pair above the 50.0% Fibonacci level and then we would get additional support with the MA50 and MA200 moving averages. We also see that the next higher resistance in the zone is at a Fibonacci level of 61.8% at 1.38380 and that we need stronger bullish momentum to hold the pair up and move to higher levels on the chart.
NZDUSD chart analysis
If we look at the NZDUSD chart on the daily timeframe, we see that we are moving in a descending channel and that the pair, after hitting the top line of the channel, has another pull towards lower levels. When we set the Fibonacci level, we see that the resistance at 61.8% Fibonacci level is at 0.71220, and then we have support at 38.2% Fibonacci level at 0.7000. Now the pair is consolidating around 50.0% of the Fibonacci level at 0.70615 with some support for the MA200 moving average, causing us to enter a bearish trend. While the pair is generally in a slightly bearish trend, a move to the lower support line cannot be ruled out as a possible option. And what we can tell is that there is a larger support zone in the 0.69250-0.70000 range.
The confidence of German companies weakened for the third month in a row in September. The results of research by the Ifo Institute on Friday showed that delivery bottlenecks are dampening manufacturers’ expectations.
The business climate index fell from 99.6 in August to 98.8 in September. The result should drop to 98.9.
Companies were less satisfied with their current business and more skeptical about the coming months.
The current situation index unexpectedly fell to 100.4 from 101.4 in the previous month, and the expected level was 101.8. Ifo President Clemens Fuest said problems with the supply of raw materials and semi-finished products are hampering the German economy.
The third consecutive drop in IFO’s business confidence is further evidence that the recovery in Germany is losing momentum amid ongoing supply chain difficulties. The rise in gas prices is putting additional pressure on prices and production, said Michael Tran, an economist at Capital Economics.
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