Foreign Exchange Market Commentary

EUR/USD closed higher on Monday as it consolidated some of last week's decline. Light profit taking tempered early gains and the mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are oversold but remain neutral to bearish hinting that sideways to lower prices are possible near-term. If it extends last week's decline, the reaction low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term top has been posted

USD/JPY closed higher on Monday as it extends the rally off July's low. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are overbought but remain neutral to bullish hinting that sideways to higher prices are possible near-term. If it extends the rally, the reaction high crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the Dollar.

GBP/USD closed sharply lower on Monday extending last week's decline. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI remain bearish hinting that sideways to lower prices are possible near-term. If it extends this week's decline, the reaction low crossing is the next downside. Closes above the 20-day moving average crossing would temper the near-term bearish outlook in the market.

USD/CHF closed slightly lower on Monday and below June's low crossing as it extended the decline off July's high. Stochastics and the RSI are oversold but remain neutral to bearish hinting that sideways to lower prices are possible near-term. The low-range close sets the stage for a steady to lower opening on Tuesday. If it extends this week's decline, January's low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted