As the market continues to expect less economic improvement from the US, this has sent a weakening signal to traders. The ISM Services PMI is expected to arrive slightly lower than the previous reading, while other fundamentals surrounding the greenback are expected to come in unchanged or at least slightly weaker. As such, most of the major FX pairs are gaining against the dollar as it presents less resistance to its counterparts. Let’s dive into each of the major FX pairs below.
EUR/USD: Bullish
For over a week, the EUR/USD market has been in the green. As of today, the major FX pair has recovered from the downward contractions of the past two sessions.
The current price candle can be seen standing above the 9-day Exponential Moving Average (EMA) curve. Simultaneously, the Stochastic Relative Strength Index (SRSI) indicator lines have reached the overbought region, yet they continue to move upward. Although the overbought condition has been met, fundamentals may still push price action toward the 1.1750 mark.
GBP/USD: Bullish
The GBP/USD market has followed a similar trajectory to the EUR/USD. The only difference is that this pair has been experiencing mild retracement throughout the week, but today’s trading has been strongly bullish.
This keeps the market above the 9-day EMA, signalling firm bullish momentum. The SRSI indicator lines are also on the verge of an upside crossover above the 80 level. Considering this, the market may continue higher toward the 1.3500 price area.
USD/CHF: Bearish
With the greenback losing steam, it is logical for the USD/CHF pair to be in a bearish retracement at the moment. The latest price candle is red, dipping the market below the 9-day EMA curve.
Today’s decline marks the second consecutive dip, and the SRSI indicator continues descending toward the oversold region. The lead line now tests the 50 mark while the lagging line follows closely. Therefore, this market may continue along its bearish path toward the 0.7900 price level.
USD/CAD: Bearish
The USD/CAD market has maintained its bearish path since the previous week. The downward retracements have been strong at certain points, quickly pulling the market to lower levels. The ongoing session remains bearish due to current US-dollar sentiment.
Price also sits below the 9-day EMA curve. As expected, the SRSI indicator lines are drifting deeper into the oversold region, with the lead line falling below the 10 mark. Although the lines are converging, the distance between price action and the 9-day EMA limits bullish prospects. As such, this pair may test the 1.3800 price level.
AUD/USD: Bullish
Similar to EUR/USD, the AUD/USD market has remained in the green for over a week. The market broke through resistance at the 0.6472 level last week and has continued in the same direction.
The latest price candle stands comfortably above the 9-day EMA while maintaining a bullish tone. Meanwhile, the SRSI indicator lines are moving sideways near the 100 mark. Given the current weakness in the US dollar, this pair may still break the ceiling at the 0.6600 price level.
EUR/JPY: Bullish
The EUR/JPY market has also maintained a long-term bullish course. Recent price candles are positioned above the applied 9-day EMA curve. The current session appears green, showing that buyers remain active in the market.
Likewise, the SRSI lines are delivering an upside crossover deep within the overbought region. Consequently, this suggests that upward pressure still has enough momentum to continue. As such, the market seems poised to advance toward the 185 price level.
USD/JPY: Bullish
The USD/JPY market has been consolidating recently, largely due to weak sentiment surrounding the US dollar. The pair currently trades below the 156.00 level. In fact, the latest price candle brings the pair below the 9-day EMA curve.
Meanwhile, the SRSI indicator lines are moving sideways deep in the oversold region. The available indications show slightly directionless price action. Nevertheless, based on the appearance of the most recent candle, the market seems likely to descend toward the 154.00 level unless countered by stronger economic catalysts.
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