Euro remains in a downtrend and upsides are capped against the Japanese Yen. On the other hand, gold is a good short term buy on dips.
The Euro started a slow and steady downtrend from the 133.80 swing high against the Japanese Yen. The EURJPY pair moved down and broke the 133.20 and 132.50 support levels to trade close to the 131.00 handle.
During the downside, there a break below a declining channel with support at 132.05 on the hourly chart. The pair traded as low as 131.15, and later started an upside correction. It has moved above the 23.6% Fib retracement level of the last decline from the 132.94 high to 131.15 low.
On the upside, the same broken channel support near 132.05-10 is likely to act as a resistance along with the 50% Fib retracement level of the last decline from the 132.94 high to 131.15 low.
The 132.20-25 area is also a strong offer zone since it is near the channel resistance and the 61.8% Fib retracement level of the last decline from the 132.94 high to 131.15 low.
Today, the Euro Zone, the German Producer Price Index for Oct 2017 was released by the Statistisches Bundesamt Deutschland. The forecast was slated for a rise of 0.3% in the PPI in Oct 2017 compared with the previous month.
The actual result was in line with the forecast, as there was a rise of 0.3% in the PPI in Oct 2017. Looking at the yearly change, there was a rise of 2.7% in the PPI, which was in line with the forecast, but less than the last increase of 3.1%.
The EURJPY pair is slowly moving higher after the release, but upsides remain capped near 113.05-20.
Gold price made a nice upside move recently and traded above the $1290 resistance against the US Dollar. The price traded as high as $1296.84 and is currently correcting lower.
On the downside, there are two bullish trend lines forming with support at $1289.50 and $1284.00 on the hourly chart. Moreover, the $1290-1288 levels are important and a crucial buy zone.
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