Daily F.X. Analysis, Oct 01 – Top Trade Setups In Forex - RBA Cash Rate Focused!

On Monday, China warned the Trump administration against such actions because they could affect the upcoming high-level trade talks in Washington between US-China Officials. In response, Peter Navaro, White House trade adviser, dismissed the reports and said that they are "fake news.

The U.S. Dollar Index rose and placed a 4-weeks high on Monday and moved to 99.113. The robust U.S. Dollar made Gold prices to fall below $1500 and set a 2-months low of $1464. 

Today, all eyes stay on the RBA Cash Rate as the Reserve Bank of Australia's governor, Philip Lowe is very likely to cut the interest rates from 1.00% to 0.75%. Lately, the Reserve Bank of Australia's governor, Philip Lowe, provided confusing directions about the policy. By the time of writing this, the RBA has already cut the interest rate to 0.75% from 1%; the Aussie is still supported as investors have already priced in 25 base point rate cut. 

Economic Calendar - RBA Rate Out

BTC/USD - Daily Analysis

Bitcoin price action continued mostly stable over the weekend session. The ballooning selling activities thwarted an attempt to break above $8,400.

At the same time, the falls beneath $8,000 were defended above $7,900. The Bitcoin has already placed a high of $8,066, following an opening of $8,052. The hourly chart displays the price over the descending trendline resistance. Nevertheless, the immediate bullish trend is capped by moving average resistance. 

The 50 SMA is limiting bullish trend at $8,510, and the 100 SMA currently stands in the way at $8,736. The relative strength index (RSI) is crumbling lower following dismissal from the 50's range.

BTC/USD - Daily Technical Levels

Support   Resistance 

7,727.14    8,447.94

7,372.57    8,814.17

6,651.77    9,534.97

Pivot Point 8,093.37

BTC/USD – Daily Forecast

The BTC/USD has violated the immediate resistance level of 8330 today, and now it seems to head towards the next target level of 8580. Above this, the pair may find resistance at 8745. On the lower side, 8330 is likely to work as a support today.

EUR/USD – German Business Climate Improves   

The EUR/USD opened at 1.08991 after placing a low of 1.08846 a 2-year low. The overall trend of EUR/USD was bearish on Monday. After the release of German Inflation data on Monday, the EUR/USD dropped to its lowest level since May 2017. The Headline German CPI dropped to 0.9% in September backed up by the ECB decision to ease monetary policy earlier in a month. On the other hand, the German Unemployment was in support of Euro which came as -10K against 5K expected at 12:55 GMT.

Other European economic releases had a mixed effect on the Euro. At midnight, the Spanish Flash CPI came as 0.1% against 0.3% expected along with the Italian Prelim CPI came as -0.5% against -0.3% expected at 14:00 GMT, was not in support of Euro. However, at 13:00 GMT, the Italian Monthly Unemployment Rate came as 9.5% against 9.9% expected, was in favor of Euro along with the Unemployment Rate 7.4% against 7.5% expected.

Despite the disappointing German CPI, Euro was already under pressure from the last week's resignation of Sabine Lautenschlaeger from the executive board of European Central Bank in the act of protest, against the decision of reviving quantitative easing and loose monetary policy by ECB's President Mario Draghi. 

High U.S. Treasury Yields are continuously in favor of the U.S. Dollar against Euro, and the pair EUR/USD seemed to have a hard time recovering in such circumstances. Furthermore, the fact that Germany is moving towards recession while Italy is already there is also a reason behind the downward trend of Euro.

EUR/USD - Daily Technical Levels

Support Resistance 

1.0895 1.0954

1.0872 1.099

1.0814 1.1049

Pivot Point 1.0931

EUR/USD – Daily Forecast

The EUR/USD is trading sharply bearish over the stronger dollar and has already violated the support zone of 1.0940. Below this, the EUR/USD can keep it's bearish bias and can lead EUR/USD prices towards 1.0835 today.

GBP/USD - CBI Realized Sales Ahead 

GBP/USD closed at 1.22865 after pacing a high of 1.23459. GBP/USD gained in early trade session, but after the economic releases from the United Kingdom, the pair started to fell and placed a low of 1.22752.

On Monday, UK Finance Minister, Sajid Javid said the similar words to British Prime Minister, Boris Johnson that, the United Kingdom would leave European Union at the stated deadline with or without any deal. These words were against the law which was passed to request for an extension in the period in case of no-deal settlement by the end of E.U. summit.

This law was created to avoid a no-deal Brexit. Still, these statements raised the question on ways through which No-Deal Brexit would get accomplished if needed because the only way for such a scenario is a vote by Parliament in favor of No-Deal Brexit, which is highly unlikely. Javid, along with Johnson, failed to give the details about this possible way but they gave a hint that there might be another way for that. Johnson has also not provided a solution for the settlement of disagreement on Irish Backstop yet.

When court passed the law last week, investors started to buy Sterling in hopes of fewer chances of no-deal Brexit. If the opportunities again come under attraction, the GBP/USD pair is likely to come under pressure. However, the statement about a proper way for No-Deal Brexit could shatter GBP.

On the other hand, the Current Account Release from United Kingdom at 13:30 GMT came as -25.2B against -19.2B and weakened the Pound. All the economic releases from the U.K. on Monday gave negative or null impact on sterling. Most data came as expected, which included Final GDP, M4 Money Supply, Mortgage Approvals, and Revised Business Investments. However, Net Lending to Individuals dropped to 4.8B in September as compared to 5.5B in August, was also not in favor of Sterling.

GBP/USD - Daily Technical Levels

Support Resistance 

1.2295 1.2368

1.2263 1.2409

1.2189 1.2482

Pivot Point 1.2336

GBP/USD – Daily Forecast

Recalling the previous update, the GBP/USD has crossed below 38.2% Fibonacci retracement level of 1.2340, and currently, it's holding below this level at 1.2280. The cable can further drop lower towards the 50% Fibo levels at 1.2270, and it's right on the spot. Today 1.2270 is a basic level, and below this, the GBP/USD may trade bearish until 61.8% Fibonacci retracement level of 1.2195.

All the best for today.