Major Comeback

Daily Forex Fundamentals | Written by Crown Forex | Oct 09 08 15:01 GMT |

Carry trades are back and confidence is somewhat restored in the markets after interest rate cuts were witnessed across the globe. Majors are rising across the board and the yen is falling once again now that many believe that the surge the yen has seen in the past week was too rapid.

The ECB today added to the plan as it decided to offer banks with unlimited cash and increased interest paid on overnight deposits as well as adding $100 billion to the financial system. We see the pair currently finding difficulty in breaching the support level at 1.3650 as it is also the 14 an 20 day moving average on the four hour charts. But as the pair lacks enough bullish momentum we could witness a slight rebound from the mentioned levels to the 1.37 levels. The high for today remains at 1.3784 while the low is at 1.3579.

The support level at 1.7250s is halting further losses by the GBP/USD pair but at the same time the critical level at the 1.7350s is an obstacle for the pair as we have yet to see a successful breakout. On the daily charts we still see a slight possibility of an upside correction as momentum indicators show the pair being oversold. However, if momentum was strong enough to breach the mentioned resistance, the pair could open the way to the 1.7420s before extending to 1.7450s.

As for the Japanese Yen, it was the victim of carry trades today as investors were selling the yen in front of all majors resulting in the USD/JPY to surge to a new intraday high at 101.47 which is the 61.8% correction for the long term ascending channel. Trading is still within the mentioned resistance and the 74.6% correction at 99.56. A breach of the resistance will take the pair to the 102.30s whereas a breakout of the support level will drag the pair to 98.80s before heading to the 95 levels.

Crown Forex

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