Trading plan for Oct. 17
EUR/USD spiked down towards $1.2700, but then recovered to $1.2750 area. This time data from the US showed solid growth. The bearish pressure will lift only if the pair rises above $1.2790 (Oct. 9 high). Note that the market is still in doubts about the American economy and the Fed’s policy. The odds are that euro once again tests $1.2700 and $1.2685/60. We’ll consider selling on recoveries to $1.2790. Tomorrow watch the German Bundesbank President Weidmann speech and the US figures, as well as Yellen’s speech.
GBP/USD is still seeking a direction: the price hit a new daily low at 1.5940, but recovered back towards 1.6000 rather quickly. The price could jump towards 1.6150 on the new dovish signals from US, but the medium term picture still remains bearish. Support lies at 1.5950, 1.5900 and 1.5870. There are no releases in Britain scheduled for tomorrow. Next week will be much more eventful in the UK, so we’ll be waiting for clearer signals.
USD/JPY recovered towards the 106.00 mark on Wednesday following the yesterday’s dip to 105.10. However, in the current conditions we expect the upside to be capped by 106.80. The next bearish target lies at 104.50.
AUD/USD corrected down to the lower border of the channel in the area of $0.8685, and is trying to recover. There will be no news in Australia, so this time the pair’s recovery may be limited. Watch for resistance at $0.8770, $0.8815 and $0.8850. Support is at $0.8700 and $0.8675.