The EURUSD continues to trade lower this morning, now trading at 1.2877 versus 1.2950 at this time yesterday. The pair has shown a bias to re-test the 1.2745 level rather than testing the 1.30 level on the upside. Today’s low was set at 1.2867 during Asian session. The pair is trading at a 14 months low, a breach below the 1.2745 will be the lowest price since Nov 2012, a new 2 year low.
The weekly range so far is set between 1.2867 and 1.2959. Studying the H2 chart (see below) the pair continues to trade under the trendline. The outlook continues to be bearish, as a clear downtrend has developed. To put this into perspective it is important to recognize that we have witnessed a steep decline in the EURUSD from 1.3990 to 1.2865 and this could lead to a near term correction. The next key support line is to be found at 1.2745 followed by 1.2550. On the upside resistance levels are at 1.29, 1.30 figure level, followed by 1.3165.
The GBPUSD has extended its losses this week, declining further to reach a low of 1.6065 earlier this morning. The pair closed last week at 1.6345 and is down near enough 300 pips on the week. Cable is 0.5% lower than yesterday and approaching the key 1.60 level.
The pound has suffered from the approaching referendum that will decide the fate of Scotland in regarding its parting from the United Kingdom. The pair has declined by 1100 pips or 11 cents in the previous 2 months. GBPUSD may find buyers 1.60000, 1.5900, and 1.5850 A consolidated breach of the 1.60 level will be a strong bearish signal. Resistance levels and upside targets at 1.6100, 1.6250 and 1.6365.
Crude Oil has bounced off its lows of $91.80 and is trading at $92.85 a barrel after reaching a $93.25 high. Crude has been buoyed by the economic growth in the US and expectations that a stronger US economy will lead to more oil consumption. Crude Oil Inventories released Wednesday are expected to show a 1.5m barrel decline in stockpiles, bolstering the price.
Geopolitical tensions in various regions, namely Russia, Middle East, Syria and Iraq as well as in Israel and Libya create an unpredictable and potentially volatile environment for Energy markets, natural gas as well as crude. The next key support areas are $92.00 per barrel followed by the $91.00 and the key $90 a barrel support level. On the upside resistance levels are to be found at $93.50 and $95 a barrel.