The Nikkei index has experienced a notable downturn, marking a 4.64% decline over the past month. This substantial drop has the attention of traders worldwide, leading many to speculate on the future movements of key currency pairs.
In particular, the EURGBP and USDZAR pairs have garnered significant anticipation for potential weakening in the coming weeks. As global economic dynamics shift and market uncertainties persist, understanding the factors driving these trends is crucial for navigating the current financial landscape.
The EURGBP Performance
EURGBP bears are in the market.
The recent structure and price action indicate that the bears have an interest in this market. This is as we see a bearish impulse wave from the top of the ascending trendline. This caused the market to break below the previous market structure.
Furthermore, the market created a corrective structure where a lower high was formed around 0.86573 and dropped +80 pips. This price action and pattern indicate a continuation to the downside. As such, traders are bearish and anticipate the market to drop to 0.85190.
![Nikkei down & Traders Anticipate A Drop On USDZAR](https://www.tdmarkets.com/wp-content/uploads/2023/08/EURGBP.tsH4_-1024x475.png)
The JPN225 (Nikkei) Performance
(UPDATE) - The Nikkei continues to drop.
The month of August has been bad for the Nikkei as the market is already down 4.64%. According to price action, the market has a corrective structure and is poised to enter the bearish cycle. Traders are still negative, expecting the market to fall to the lows of the larger declining structure.
![Nikkei down & Traders Anticipate A Drop On USDZAR](https://www.tdmarkets.com/wp-content/uploads/2023/08/JPN225.tsH4-3-1024x475.png)
The USDZAR Performance
USDZAR is currently trading at the supply zone and at the top of the descending structure. This comes after the market bounced from the previous support zone around 17.68730 and rallied to the upside. According to this price action, traders anticipate the market to retrace the bullish impulse wave before looking for trading opportunities. As such, a break and close below the previous high of around 19.14982 will cause a drop back to the demand zone. This will be around the 50.0 and 38.2 fib levels.
Read More: Is The Dollar On The Rise? We Can See It Moving Further Up
![Nikkei down & Traders Anticipate A Drop On USDZAR](https://www.tdmarkets.com/wp-content/uploads/2023/08/USDZAR.tsDaily-1024x475.png)
Final Thoughts On Today’s Analysis
The Nikkei index's 4.64% monthly decline serves as a reminder of the ongoing volatility and uncertainties within the financial markets. Traders are keeping a watchful eye on key currency pairs like EURGBP and USDZAR. This is as they navigate the intricate interplay of economic indicators, policy decisions, and geopolitical events. Subscribe to our YouTube channel today.