FOREX Technical Analysis & Review 29 Oct

Posted: October 29, 2014 in Forex

The EUR/USD pair had a volatile session during the day on Tuesday, but truthfully I believe that this market is waiting to see went the Federal Reserve does as far as an interest rate decision today. EUR-USDI recognize that the Federal Reserve more than likely will keep rates exactly where they are, but will really get the market moving is the statement. If there is hints of the Federal Reserve tightening of monetary policies or at least some type of hawkish behavior, that will be very good for the US dollar, and send this pair much lower. On the other hand, if they make it abundantly clear that the market should and anticipate any type of hawkish stance from the Federal Reserve anytime soon, then this pair could go higher.
The GBP/USD pair went back and forth during the day showing quite a bit of volatility, but in the end formed a very neutral candle. GBP-USDBecause of this, we feel that the market is probably waiting on the statement coming out of the Federal Reserve, and as a result it’s a little bit difficult to imagine what the market is going to do ahead of time. We do think that a sustained move above the 1.62 level is a buying signal though, and that’s quite frankly we were hoping for. In the meantime, we will be patient.
The Australian dollar rose during the session on Tuesday as you can see, but remains in the previous consolidation area. Besides, we have beenAUD-USD saying for some time we expect to see a significant amount of resistance all the way to the 0.90 handle, and as a result we are not interested in buying it. In fact, we would love to see some type of resistant candle in order to start selling yet again. Keep an eye on the gold markets though, as they tend to be major drivers of where this pair goes.
The USD/JPY pair bounced off of the support level below, breaking the top of the hammer from the Monday session on Tuesday. Because of this, we believe that this market is readyUSD-JPY to go higher, and as we are bullish, we have no concerns whatsoever about buying. Keep in mind that there is an interest-rate announcement today, and more importantly a statement coming out of the Federal Reserve, but ultimately we believe that the longer-term trend is always going to be to the upside and we are still targeting the 110 level.

Data Update for 29th Oct 2014

Time Currency Impact Particualr Forecast Previous
5:20am JPY Prelim Industrial Production m/m 2.30% -1.90%
5:30am NZD High ANZ Business Confidence 13.4
3:00pm GBP Net Lending to Individuals m/m 2.8B 3.2B
GBP M4 Money Supply m/m 0.50% 0.30%
GBP Mortgage Approvals 63K 64K
Tentative EUR German 10-y Bond Auction
6:00pm CAD RMPI m/m 1.50% -2.20%
CAD IPPI m/m 0.30% 0.20%
8:00pm USD Crude Oil Inventories 7.1M
11:00pm GBP MPC Member Haldane Speaks
11:30pm USD High FOMC Statement
USD High Federal Funds Rate <0.25% <0.25%

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