Its payrolls Friday and the US dollar has a chance to pare losses
Daily Forex Market Preview, 04/11/2016
The October payrolls report will be the main event for the markets today and could offer a chance for a reprieve for the US dollar which has been trending lower, for the most part, this week. Despite a broadly upbeat economic data, the dollar remains under pressure with the upcoming US elections next week, keeping traders on edge. With the US dollar index trading at the technical support and the daily Stochastics likely to print a hidden bullish divergence, there is a chance for the greenback to retrace its gains for an eventual rally back to 98.35 price level which could be challenged as resistance.
EURUSD Daily Analysis
EURUSD (1.1093): EURUSD closed with a spinning top pattern yesterday near the resistance level of 1.1143 - 1.1100. This could signal a potential exhaustion to this week's strong short-term uptrend and could post a near term correction towards 1.1000 support initially. On the 4-hour chart watch for EURUSD to breakout from the rising median line, after two attempts to break out above 1.1116 resistance failed. Initial support at 1.1000 - 1.0976 will be key in holding the declines, but a breakdown below this level could signal a further dip in prices towards 1.0931 - 1.0900 support. A convincing reversal at either of these two support levels could see EURUSD eventually rise towards 1.1150 resistance that will be challenged next.
USDJPY Daily Analysis
USDJPY (103.17): USDJPY has broken down from the rising median line on the daily chart, but there is scope for a potential upside correction. 104.00 remains the initial resistance level that can be challenged, while to the downside, further declines could send USDJPY to test 102.00. On the 4-hour chart, price action looks to post a reversal, but a higher low is required, preferably above 103.25, which will confirm the upside in USDJPY towards 104.00 followed by a retest to 104.45 - 104.60 resistance.
XAUUSD Daily Analysis
XAUUSD (1300.26): Gold prices have failed to breakout above 1300 psychological level convincingly with the price being rejected near 1306 - 1310 minor resistance level. On the 4-hour chart, a bearish divergence is seen signaling near-term correction towards 1275 support that could be challenged. The declines are likely to be limited in nature unless 1275 gives way, in which case gold could see 1250 again. The short term trend in gold remains to the upside, so a reversal near 1275 could potentially keep gold supported for another retest to 1300 and 1325 in the near term.