Home Daily Analysis Forex Market Overview Daily FX Brief, Aug 26 – Top Trade Setups In Forex, Risk-off...

Daily FX Brief, Aug 26 – Top Trade Setups In Forex, Risk-off Sentiment Dominates!


The US dollar index, or DXY, concluded last week in negative territory, down 0.96%. Last week July’s FOMC, Federal Reserve officials observed their interest-rate cut previous month as protection against too-low inflation and the risk of a broader slowdown in business investment arising from risk over US President Donald Trump’s trade war.

The dollar is finally making some bullish correction after speculators trimmed the net long (bullish) US Dollar bets to the lowest level since July 2018, during the week that ended on Aug. 20.

Economic Events to Watch Today

Let’s took at these fundamentals…

EUR/USD – Daily Analysis

The EUR/USD Currency Pair HIt Bullish Track Today And All Focus On German IFO Data.

Today in the early Asian market, the EUR/USD currency pair hit the bullish market of 1.1164 and currently trading at 1.1142. The bullish close, however, probably will continue elusive if the Ifo German data issues below forecasts due to intensifying trade war tensions.

During Friday the EUR/USD currency pair climbed 0.53%, covering Thursdays high and lows. Essentially, such as the pair performed a bullish outside day candle, which is broadly considered an early indication of a potential bearish-to-bullish trend change.

Moreover, the buyers could face a difficult time, forcing a beak above 1.1153 due to intensifying trade war tensions between the United States and China. Last Friday, President Donald Trump Tweeted that Furthur tariff on Chinas goods which will start from 1 September and 1 October.

On the other hand, the IFO German data scheduled for publishing at 08:00 GMT will give insight into the newest thinking regarding German executives. Notably, according to forecast Busines Climate will fall to 95.1 from July’s print of 95.7.

Daily Support and Resistance

S3 1.0912

S2 1.1014

S1 1.1078

Pivot Point 1.1116

R1 1.118

R2 1.1217

R3 1.1319

EUR/USD – Trading Tips

On Monday, the EUR/USD surged dramatically to violate the sideways channel of 1.1100 – 1.1065. Since the EUR/USD is already trading above 1.1100, this level is likely to work as a support. Therefore, consider staying bullish above 1.1100 with a stop loss below 1.1060 and target of around 1.1140 and 1.1165.

GBP/USD – Daily Analysis

At the Starting of the week, the GBP/USD currency pair failed to maintain early day recovery, and buyers seem to step back due to the intensifying trade tension between the US-China and uncertainty increased into no-deal Brexit.

As of writing, the GBP/USD currency pair presently trading near 1.2272 ahead of Monday’s London open.

After came the announcement from the United States regarding additional tariffs on other Chinese Exports Items, the United States and China increase the fears of international economic slowdown due to the trade tussle between the two largest economies in the world. Besides this, the Greenback dropped across the board last Friday.

On the flip side, the dovish statement from the bank of England and the Federal Reserve chiefs, at the Jackson Hole Symposium last Friday, appears to have offered a path to the GBP/USD pairs ahead of the trade news that crossed wires during the day.

Meanwhile, the traders keep their eyes on the fresh hint regarding trade and Brexit.

Daily Support and Resistance

S3 1.2054

S2 1.2157

S1 1.2224

Pivot Point 1.2261

R1 1.2327

R2 1.2364

R3 1.2467

GBP/USD – Trading Tips

Traders long this market, however, face considerable resistance at the 1.23 handle, a daily channel resistance (taken from the high 1.3176) and weekly resistance at 1.2329. The main catalyst behind the latest run higher comes on the back of prospects of a Brexit-deal breakthrough.  Consider staying bullish above 1.2245 in GBP/USD with a target of 1.2290 and 1.2330.

AUD/USD – Daily Analysis

The AUD/USD currency pair found on the bearish track low of 0.6703 after the starting the week with the bearish gap. Australian traders reply to macro risk-off due to the United States and China trade tussle intensified in recent days. Events such as China announcing new tariff on the United States goods worth of $75 billion, and in the return of this, United States increasing the tariff on $500 billion worth of Chinese goods broadcasted last Friday.

Besides the tariff hike, the United States President Donald Trump also push US organisations to pull their production factories out of China.

On the other hand, the Jackson Hole Symposium reduced the bid due to the United States Federal Reserve Chairman Jerome Powell focused economic uncertainty. Meanwhile, the Reserve Bank of Australia Governor Philip Lowe asked for the government guide to stimulate development.

Daily Support and Resistance

S3 0.667

S2 0.6713

S1 0.6732

Pivot Point 0.6755

R1 0.6774

R2 0.6797

R3 0.6839

AUD/USD – Trading Tips

The AUD/USD slipped dramatically from 0.6770 to 0.6690 amid weakness in Aussie. Investors started selling off Aussie over an escalating trade war between the U.S. China. On the 4 hour timeframe, the AUD/USD has already violated the symmetric triangle pattern, which now extends resistance at 0.6770.

Consider staying bearish below 0.6770 to target 0.6730 and 0.6700. All the best!


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