FX Breakout Monitor: September 9, 2020 FX Breakout Monitor: September 9, 2020 FX Breakout Monitor: September 9, 2020

FX Breakout Monitor: September 9, 2020

Forex 4 minutes to read
John Hardy

Head of FX Strategy

Summary:  Sterling weakness has persisted today and both silver and gold are eyeing a break lower if they close on a weak note today. Elsewhere, the US dollar continues to eye breakouts to the upside in places, today actually approaching a local breakout level against the Singapore dollar, the first USD-Asia pair to register on our radar in some time.

Today’s Potential New Breakout Signals

Today we highlight three potential breakouts today that could prove valid on today’s close of trading (breakout signals only registered on successful closes beyond the breakout level). Note that today we add silver to the list as has traded at a 19-day low close today.

Table: Seven potential breakouts today and methods for trading
We post the potential gold breakout lower again today as yesterday failed to see the price closing below the 19-day low close. We lower the entry level to 1906, justifying this with the fact that yesterday’s larger sell-off to below 1907 requires a bit more range in today’s open to close levels to show more determined downside momentum. Silver is in a similar situation as we discuss below.

Source: Bloomberg and Saxo Group

Chart highlight: EURJPY
The technical situation in EURJPY is rather similar to EURUSD, which posted its lowest close in almost a month yesterday. Really, the pair needs to push down through the 124.50 area to suggest a larger breakdown risk – one that could be triggered in party by the euro absorbing some of the concern linked to the sudden return of hard Brexit risks this week. The reaction to tomorrow’s ECB meeting will be the deciding factor.

Source: Saxo Group

Spot silver is in largely the same situation as spot gold – here we suggest a close below 26.00 today, or soon, begins to show downside momentum risks picking up. We place the entry level for the example breakout trade setup at a level below the nominal 19-day low close of 26.44 because yesterday’s intraday price action took the pair below 26.00 for a brief few minutes and a closing level back toward that level suggests far more weakness than trading below the prior 19-day low close, which is still up in the area of the recent trading range.

Table: Today’s Breakout Monitor
The breakout monitor below offers an overview of recent daily breakouts (a close above or below the prior 19-day highs or lows and 49-day highs and lows to give an indication of whether it there is also a medium term development). Note GBPCHF is looking at a new 19-day low, adding to the picture of broadening sterling weakness.

Source: Saxo Group and Bloomberg

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-hk/legal/disclaimer/saxo-disclaimer)

Saxo Capital Markets HK Limited
19th Floor
Shanghai Commercial Bank Tower
12 Queen’s Road Central
Hong Kong

Contact Saxo

Select region

Hong Kong S.A.R
Hong Kong S.A.R

Saxo Capital Markets HK is a company authorised and regulated by the Securities and Futures Commission of Hong Kong. Saxo Capital Markets HK Limited holds a Type 1 Regulated Activity (Dealing in securities); Type 2 Regulated Activity (Dealing in Futures Contract); Type 3 Regulated Activity (Leveraged foreign exchange trading); Type 4 Regulated Activity (Advising on securities) and Type 9 Regulated Activity (Asset Management) licenses (CE No. AVD061). Registered address: 19th Floor, Shanghai Commercial Bank Tower, 12 Queen’s Road Central, Hong Kong

By clicking on certain links on this site, you are aware and agree to leave the website of Saxo Capital Markets, proceed on to the linked site managed by Saxo Group and where you will be subject to the terms of that linked site.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

Please note that the information on this site and any product and services we offer are not targeted at investors residing in the United States and Japan, and are not intended for distribution to, or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation. Please click here to view our full disclaimer.