EUR/HUF edged higher during the European morning Thursday

EUR/CHF

The dollar traded unchanged or higher against most of its G10 peers during the European morning Thursday. It was higher against AUD, GBP, NOK and NZD, in that order, and was virtually unchanged against CAD, JPY, EUR, SEK and CHF.

Cable was among the losers during the European morning, after the UK house prices for July rose at their slowest pace since April 2013. House prices as measured by the Nationwide index rose +0.1% mom in July, down from +1.0% mom in June, recording their 15th consecutive increase but missing estimates of a +0.5% mom rise. Recent tighter mortgage-lending policy rules introduced by the Bank of England in an attempt to prevent home buyers taking on too much debt are most likely behind this month’s slowdown. The Bank’s Governor, Mark Carney, had point out the booming housing market as the biggest threat to UK’s recovery.

The Hungarian forint was one of the losers among the EM currencies. The dollar has been rallying against most EM currencies recently and investors have been particularly punishing the currencies of the former Soviet bloc nations along with the RUB recently despite the fact that they are now EU member states. The recent rebound in Hungary’s CPI rate and the moderate decline in the country’s unemployment rate were ignored by the market, sending USD/HUF to levels last seen in April 2013.

EUR/HUF edged higher during the European morning Thursday, after finding support at 310.75 (S1). However, the advance was halted by the upper boundary of the blue upside channel and the resistance barrier of 312.25 (R1). The rate is printing higher highs and higher lows within the channel and above both the moving averages and this keeps the short-term picture to the upside. The MACD, already within its positive field, moved above its signal line, confirming the recent bullish momentum of the rate. I would ignore the overbought reading of the RSI for now, since the indicator is pointing up and could stay within its extreme territory for a noticeable period of time. A decisive violation of the 312.25 (R1) obstacle could trigger further bullish extensions and could pave the way towards the next resistance at 313.00 (R2).

• Support: 310.75 (S1), 310.05 (S2), 309.00 (S3) .

• Resistance: 312.25 (R1), 313.00 (R2), 314.00 (R3).