Market analysis on EURUSD, GBPUSD and AUDUSD for the month of September

forex analysis

EURUSD

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Figure: EURUSD daily chart analysis

The medium-term uptrend in the EURUSD pair has been breached by the sharp fall of price on 24th June 2016.From that level, the pair has managed to bounce back from the weak support zone of 1.09090.The EURO has gained some bullish momentum after the Brexit news taking the advantage of weak US dollar. The pair managed to rally upward more than 400+ pips within just two weeks of the sharp fall. The broken uptrend line which turned into resistance provided a significant amount of resistance at 1.13529 levels to the EURUSD pair creating a bearish pin bar in the daily chart. The pair then again rallied in the southward direction towards the weak support zone of 1.1130 levels. Currently, the price is trading just above the 1st august high which is most likely to be breached by the US positive economic data. Though the US dollar is broadly weaker against all its major rivals from the very beginning of this year, traders are very cautious about the upcoming FOMC meeting minute.FED seems to be more determined to raise their interest rate in the month of September but the latest bad data of average hourly income and unemployment claim has created a mass confusion into the mind of investors. Considering the technical and fundamental analysis the overall bias of the EURUSD pair still remains bearish. Shorting the pair near the broken trend line resistance would be an excellent sell in compliance with price action confirmation signal. On the contrary, if the pair manages to breach the 1.13529 resistance level than we can expect another strong rally in the upward direction with an initial target of 1.1620 levels.

GBPUSD

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Figure: GBPUSD daily chart analysis

The Great Britain Pound is struggling hard to recover its loss followed by the Brexit news on 24th of June 2016.On the event of Brexit news, the GBPUSD pair has strike the low 1.27842 which is a historical event in the forex industry. From that level, the pair has started its initial correction in the upward direction which was limited by the critical resistance level 1.34476.The pair sharply dropped again from that level forming a bearish engulfing pattern on the daily chart. On the event of bad data of US economy, the downward rally of the British pound has not stopped temporarily and trying to form a new higher high associated with higher lows in the market. If the pair manages to breach the 1.34476 level then we can assume a strong upward correction in the pair towards the 1.38392 level. But breaking that level will be significantly tough in the month of September since the FED is ready to hike their interest rate in the month of September.

The recent economic news release of Great Britain pound is offering some promise towards the upward correction of this pair. But if the critical support level 1.3200 levels fail to hold the pair then we can assume another strong downward rally in this pair. The first target for the pair would be the low of 14th august 2016.The temporary support at 1.28683 levels might give a little bullish momentum to this pair but the support level will be irrelevant if the FED come up with the hawkish statement in the upcoming FOMC meeting minutes. Considering the fundamental news and technical factors trading this pair at the current price level will be an immature act. The pairs need to have bullish closing above 1.24476 levels in order to find new buyers in the market. On the contrary, a clear decisive break of 1.2800 levels is required for the further downward momentum of this pair.

AUDUSD

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Figure: AUDUSD daily chart analysis

The Aussie dollar has shown significant amount of strength against its all major rivals especially the US dollar. For the last couple of months, there has been a strong upward rally in the AUDUSD pair .The upward rally has been furthermore intensified by the bad US economy through the month of august, 2016.Currently, the pair tends to complete its bullish correction forming a top at 0.78344 level. But due to the possibility of rate hike decision in the month of September, the dollar has gained some significant strength despite the weak unemployment and average hourly income data. For the bullish scenario, the AUDUSD pair needs to break above the 0.78344 level to find some fresh buying pressure. A daily closing above that level will confirm the establishment of the medium-term uptrend. The next critical resistance level for this pair lies in the 0.8000 mark. On the contrary, the pair is most likely to face strong resistance zone near the broken trend line. Currently, the broken trend line resistance is situated at 0.7700 marks. Considering all the fundamental and technical parameters the overall scenario for the AUDUSD pair is still bearish. For the last three weeks, the price has been testing the bearish trend line .Price has been rejecting the bearish trend line in the weekly chart significantly forming tweezers top pattern indication an imminent bearish reversal in this pattern. Though the setup is extremely reliable and convincing yet the smart investors are in fear about the upcoming FOMC meeting minute. If the FED comes up with the dovish statement than the long term bearish trend line in the weekly chart will be easily breached with a strong bullish candle. So it’s better to stay on the sideline or wait for some minor retracement in the pair so that we get the better selling price for this pair.