October 20, 2021
EUR/USD: The euro strengthened on Tuesday as the dollar dipped after data showed that U.S. homebuilding unexpectedly fell in September and permits dropped to a one-year low amid acute shortages of raw materials and labor, supporting expectations that economic growth slowed sharply in the third quarter. The dollar index was down 0.22% against a basket of other currencies, after dropping to 93.50 earlier, the lowest since Sept. 28. In case of a further decline in the dollar, the growth of the European currency will continue. Immediate resistance can be seen at 1.17. A breakout to the upside can trigger a rise towards 1.1750.
BUY STOP 1.17/TP 1.1750/SL 1.1680
USD/CAD: The Canadian dollar rose to its highest level in more than three months against its broadly weaker U.S. dollar on Tuesday, before giving up some gains as investors took profits ahead of a key Canadian inflation report on Wednesday. The price of oil, one of Canada’s major exports, settled 0.6% higher at $83 a barrel as an energy supply crunch continued across the globe. The loonie was trading at 1.2350 to the greenback, after touching its strongest intraday level since July at 1.2310. If oil renews new local highs, the Canadian dollar will continue to rise. Immediate support is seen at 1.2340. A break below could take the pair towards 1.2250.
SELL STOP 1.2340/TP 1.2250/SL 1.2370
GBP/USD: Sterling hit a four-week high against the dollar on Tuesday as expectations mounted that the Bank of England (BoE) will hike interest rates, while the greenback dipped as the rise in U.S. Treasury yields in recent days stabilized. BoE Governor Andrew Bailey on Sunday sent perhaps the clearest signal yet of a pending hike, saying the BoE will have to act to deal with rising energy costs in Britain which threaten a surge in consumer prices. In case of further hints from the British regulator to tighten the policy, the pound will reach a new local high. Immediate resistance can be seen at 1.38. A breakout to the upside can trigger growth towards 1.3850.