EURUSD ends a 10-day losing streak
Daily Forex Market Preview, 22/11/2016
The US dollar closed bearish yesterday for the first time after a strong 10-day gain that saw prices rally from 98.00 to trade above 101. The bearish close in the dollar offered some respite for the single currency which has been in one of the worst losing streaks. In Japan, news of a 6.9 magnitude earthquake off the eastern coast on early Tuesday push the yen slightly higher although the impact was seen to be limited. The Nikkei index briefly fell on the news only to recoup the losses. On the economic front, today's home sales data will be under the scanner.
EURUSD Intra-day Analysis
EURUSD (1.0629): EURUSD ended its 10-day losing streak yesterday after price closed bullish at 1.0626. Still, there is not much of evidence that the current bullish close will trigger the start of the correction as the risk of a bearish reversal remains. On the 4-hour chart, the single currency managed to break out from the falling trend line, but prices are seen flat within 1.0700 and 1.0600. Only a close above the resistance at 1.0700 will signal further upside as EURUSD could be seen targeting 1.0800 with the unfilled gap at 1.0855 likely to be the next target.
USDJPY Intra-day Analysis
USDJPY (110.84): USDJPY closed with a spinning top pattern yesterday with a bearish close. The significance of this pattern is even more important as it comes after a strong wave of buying, which could indicate a near-term pullback if we see a daily close below yesterday's low of 110.46. Short-term support is seen at 109.76 - 109.49 which could hold prices in the near term. Only a break below this support will confirm the declines towards 105.43 - 105.18.
XAUUSD Intra-day Analysis
XAUUSD (1218.71): Gold prices closed with an inside bar yesterday which could signal an upside correction on a daily close above 1217.91. Short-term support could be seen coming in at 1212.50, and if gold prices hold above this support, the price could be seen targeting 1232.20 resistance level with further upside expected only on a close above this resistance level on the daily chart. 1250 remains the next key resistance level on further continuation. To the downside, failure to hold above 1212.50 could signal near term consolidation back at the lows with the potential to test 1200 psychological support in the near term.