Title: Traders on High Alert as October US Inflation Report Approaches
As the October US inflation report is set to be released on Tuesday, traders are bracing themselves for potential volatility in the foreign exchange (FX) market. The results of the Consumer Price Index (CPI) will be closely watched, and any significant deviation from consensus expectations could have a significant impact on market direction and FX movements.
The USD/JPY, GBP/USD, and AUD/USD pairs are all expected to encounter pivotal technical levels that could act as either support or resistance in the coming trading sessions. Traders are advised to remain vigilant on Tuesday, as the inflation figures are likely to influence market sentiment and trigger FX moves.
An upside surprise in the inflation results could serve as a bullish indicator for the US dollar. Conversely, weaker-than-expected CPI data could pose a challenge for the greenback, potentially acting as a headwind in the FX market.
Among the currency pairs to watch, the USD/JPY has been on an upward trajectory and could face resistance at the psychological level of 152.00. However, intervention by Japanese authorities in the FX market may cause the USD/JPY to break below 150.90, potentially leading to a decline towards 149.00.
Meanwhile, the GBP/USD encountered resistance near 1.2460 and has retraced back above the 50-day simple moving average. If it maintains its position above this indicator, there is a possibility of a move towards 1.2325. However, a breach of trendline support at 1.2140 could result in a descent towards the 2023 lows.
The AUD/USD has recently found technical support near 0.6350 and is currently testing the 50-day simple moving average. If it manages to surpass this level, a rally towards 0.6460 is in sight. However, should sellers initiate a bearish reversal, the primary support area to watch is at 0.6350, with potential downside towards 0.6310 should weakness persist.
Traders are advised to stay well-informed and closely monitor the October US inflation report as it is expected to provide crucial insights into market direction and FX trends. The outcome of the CPI results will likely shape the near-term trading landscape and influence investor sentiment regarding the US dollar.
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