Trading plan for 09/10/2017:
A quiet start of the week in Asia due to the absence of investors from Japan. The overnight PMI data from China has disappointed the global investors. The currency market is stable with a slight advantage of GBP and CHF. The GBP/USD bounce to 1.3100 level is the strongest, though without much conviction. EUR/USD was stuck at 1.1730, and USD/JPY has returned to consolidation from the last days and is now at the level of 112.60.
On Monday 9th of October, the event calendar is light in important economic releases. Only two data releases are scheduled: Industrial Production from Germany and Sentix Investor Confidence from Eurozone. Both will be posted during the early London session.
EUR/USD analysis for 09/10/2017:
The Industrial Production data from Germany has beaten the market participants expectations who anticipated a 0.9% increase after -0.1% drop a month ago. Nevertheless, the figure posted was at the level of 2.6% on monthly basis and 4.7% on yearly basis. Industrial production is significant as a short-term indicator of the strength of German industrial activity. High or rising Industrial Production figures suggest increased production and economic expansion, healthy for the Euro. However, uncontrolled levels of production and consumption can spark inflation. This is the best result for German industrial output in 7 months, which indicates this sector of the economy keeps expanding and slow, but persistent pace.
Let's now take a look at the EUR/USD technical picture at the H4 time frame. The price has bounced from the technical support at the level of 1.1662 and now might be forming a Rising Wedge pattern. The momentum indicator does not support this scenario for now because it still stays below its fifty level. THe most important support is still at the level of 1.1610 and the key resistance zone is still between the levels of 1.1821 - 1.1847.
Market Snapshot: USD/JPY reverses after triangle breakout
The price of USD/JPY had broken out of the triangle to form the new local high at the level of 113.34 but reversed quickly to the nearest support at the level of 112.19. There is still a chance that the market will reverse lower as the bearish divergence between the price and momentum indicator is still on the table. The next technical support is seen at the level of 112.19 and 111.45.
Market Snapshot: Gold bounces from 61%Fibo level
The price of Gold had bounced from 61%Fibo at the level of $1,263 and currently is testing the broken golden trend line from above. The upward momentum remains strong, but the key level to the upside is still at $1,300 and as long as the price remains below this level, the bias is still to the downside.
