Daily Market Report – EUR/GBP Crucial Break Eyed September 12, 2017

By Mexgroup.com

EUR/GBP On The Way Down

The price is trading in the red and seems poised to hit fresh new lows till the end of the day. EUR/GBP plunged and resumed the bearish movement, but now is very close to reach another downside target. Is pressuring the 0.9000 psychological level, a valid breakdown will signal a further drop in the upcoming days. The Cable rallies and should reach new highs as the United Kingdom inflation data have come in better than expected.

The Pound has surged aggressively also versus the Yen and versus greenback, not only versus the Euro. The UK’s CPI surged by 2.9% in August, bearing the 2.8% estimate and the 2.6% growth in the former reading period, while the Core CPI rose by 2.7%, exceeding the 2.5% estimate and the 2.4% growth in the former reading period.

The PPI Input, PPI Output, RPI and the HPI indicators have come in better than expected and have boosted the Cable.

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The currency pair drops and is pressuring the 0.9000 psychological level. Should drop further and is expected to reach the third warning line (wl3) of the descending pitchfork. Technically it could be attracted by the confluence area formed at the intersection between the warning line (wl3) with the median line (ML) of the major ascending pitchfork and with the lower median line (lml) of the minor ascending pitchfork. The retreat is natural after the false breakout above the 0.9226 static resistance and above the upper median line (UML) of the ascending pitchfork.

A valid breakdown below the mentioned support levels will confirm a drop at least till will reach the lower median line (LML) of the major ascending pitchfork.

EUR/USD Bears In Control

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EUR/USD has failed to resume the upside movement and now has started another leg lower. I’ve said in the previous report that it could drop if will stay within the descending pitchfork’s body. The false breakout above the 1.2041 level and above the 50% Fibonacci line (ascending dotted line) signaled an exhaustion. The next downside target will be at the median line (ml) of the descending pitchfork, actually could be attracted by the confluence area formed between the median line (ml) of the ascending pitchfork with the median line (ml) of the ascending pitchfork.

USD/CAD Is The Downside Movement Completed?

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USD/CAD increased a little today as the pressure is still high. You can see that has failed to reach the lower median line (lml) of the descending pitchfork and the sliding line (descending dotted line), signaling that has lost the bearish momentum. I’ve added an ascending pitchfork, a retest of the lower median line (lml) will confirm a rebound on the short term.

By Olimpiu Tuns

Market Analyst

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