EURUSD tumbles as SNB move increase bets on ECB action
EURUSD tumbled yesterday after the Swiss National Bank suddenly abandoned the EUR/CHF floor, increasing bets that the ECB would introduce a large scale QE program at its policy meeting next Thursday. The rate fell below the support (turned into resistance) line of 1.1730 (R1) and hit support at 1.1565 (S1). The bias is back to the downside, therefore I would expect a move below 1.1565 (S1) to target the psychological figure of 1.1500 (S2). Our daily oscillators detect accelerating bearish momentum and amplify the case for further declines. The RSI continued declining within its oversold territory, while the MACD moved dipper into its negative field. As for the overall trend, on the daily chart, the price structure still suggests a downtrend. The pair is forming lower peaks and lower troughs below both the 50- and the 200-day moving averages.
• Support: 1.1565 (S1), 1.1500 (S2), 1.1370 (S3).
• Resistance: 1.1730 (R1), 1.1860 (R2), 1.1975 (R3).
GBPJPY continues lower
GBPJPY slide yesterday after finding resistance at 179.50 (R2), but the decline was halted near the 176.00 (S1) line. A clear break below the 176.00 (S1) could see scope for extensions towards our next support obstacle, at 174.60 (S2). Both our near-term oscillators lie within their bearish territories, with the MACD standing below its trigger line and pointing south. This indicates negative momentum and magnifies the case for further declines in the near future. On the daily chart, the dip below the 181.00 (R3) signaled the completion of a failure swing top, something that gives me another reason to expect a weaker rate.
• Support: 176.00 (S1), 174.60 (S2), 173.90 (S3).
• Resistance: 177.00 (R1), 179.50 (R2), 181.00 (R3).