Forex trading plan for November 3
EUR/USD is consolidating in the 1.1050/00 area. There is a symmetric triangle on H1. The most recent data from the euro area were rather good, but many market players still expect more easing from the ECB. Morgan Stanley on Monday lowered its forecast for EUR/USD at the beginning of 2016 to $1.03 early. As a result, traders await what the ECB president Mario Draghi says at 19:00 GMT on Tuesday. Above 1.1050 next resistance is at 1.1100/10 and 1.1160. Below 1.1000 support is at 1.0915/00.
UK manufacturing PMI came above expectations (55.5K vs. forecast of 51.8). GBP/USD opened with a gap up and approached resistance at 1.5500, which remains intact probably because manufacturing is not the main sector of British economy (for this see services PMI on Wednesday). Pay attention to British construction PMI due at 09:30 GMT on Tuesday. All the data releases this week are very important for the pound ahead of the Bank of England’s meeting on Thursday. After the US Federal Reserve leaned to a more hawkish side, traders may expect more hawkishness from the British central bank as well. Support is at 1.5400, 1.5380 and 1.5340, and retreat to these levels can provide opportunities for longs. In addition, look for confirmation of a break above 1.5500/10 to buy the cable.
USD/JPY is holding above 120.00. Tuesday will be the bank holiday in Japan. The pair will be driven by the US data releases (ISM manufacturing PMI on Monday, factory orders on Tuesday). Support is at 120.00 and 119.60. Resistance is at 121.00, 121.50 and 121.80.
AUD/USD found support above 0.7100 as Australian building approvals rebounded and on the news that Chinese manufacturing sector is stabilizing (though official PMI remained below the threshold of 50 points). Moreover, Aussie’s growth remained limited ahead of the Reserve Bank of Australia’s meeting on Tuesday. Resistance is at 0.7160 and 0.7200 ahead of 0.7280. Support is at 0.7020/00 and 0.6950.