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Currency Pair Overview:
Dollar Weakens After Mixed Reports
Overall, the dollar weakened after mixed reports were released from the United States during the trading session. The ADP employment change saw 298 thousand jobs cut while worker productivity increased. A report on factory orders during July rose less than expected as stockpiles of crude oil declined.
The euro (EUR/USD 1.4274) tried several times during the late European and early U.S. session to break above the 20 day moving average at 1.4240. It was not until after the 10:00 reports from the United States were released that the pair found enough momentum to break that area. The pair quickly ran into resistance at the 1.4300 level late in the session.
The pound (GBP/USD 1.6281) put a new swing low into place at the 1.6110 area during the early U.S. session. This level acted as a springboard for the pair, catapulting it over 120 pips or 0.75 percent higher on the day. Should the pair continue this trend, the 1.6370 area will be the next major resistance level seen.
The aussie (AUD/USD 0.8350) bottomed at the 0.8245 area during the Asian session and then found more support at the 0.8280 level during the European session, helping the pair make a push to assault the 20 day moving average again during trade in the U.S. session. The pair broke through the 20 day moving average at 0.8340 and is currently using it as support.
The cad (USD/CAD 1.01043) spent the day consolidating just under the 50 day moving average at 1.1100. This 1.1100-1.1130 area has been a major resistance point for the pair during the past month. The pair will need to close on the daily bar above the 50 day moving average in order to draw in more buyers to continue the uptrend.
The swissy (USD/CHF 1.0600) spent most of the day butting up against the 20 day moving average at 1.0685, unable to break higher. The pair then declined sharply as the dollar weakened, finding a support level around the 1.0580 area.
The yen (USD/JPY 92.13) strengthened again during the U.S. session, breaking below the previously established support at the 92.50 level. The next major level of support for the pair, as seen on the 4 hour chart, lies at the 91.70 area, a mere 45 pips away.