USDCHF drifts lower
The US dollar softens amid expectations of an end to the Fed tightening. The pair continues downward in search of bids as short-term sentiment remains pessimistic. As the daily RSI indicator sinks into the oversold zone, a ‘buy-the-dips’ behaviour could be expected. A trough at 0.8750 from the end of August is the next level to see whether the bulls would make a comeback. 0.8850 is the immediate hurdle to clear then only a jump above the support-turned-resistance and the round number of 0.8900 would turn the tide.
XAGUSD tests major resistance
Silver rallies as the US dollar slips against most major currencies. The price is testing the August peak and the psychological level of 25.00. As both the daily and the hourly RSI went overbought, the metal may meet strong pressure from the bears looking to fade the bounce as well as the bulls taking some chips off the table. A bullish breakout would force the former to cover and trigger a runaway rally to this year’s high of 26.00, ending a 7-month long consolidation. 24.10 is a fresh support in case of a fallback.
GER 40 grinds up
The Dax 40 slid as ECB President Christine Lagarde said the fight against inflation was not yet done. The index is grinding its way up as the latest vertical rise has attracted a number of buyers. 16050 is the hurdle to clear before they could push higher. However, the daily RSI’s overbought situation in conjunction with the hourly one’s bearish divergence suggests a slowdown in the current momentum and a snapback cannot be excluded in such a crowded and unidirectional trade. 15890 would be the first support should this happen.