EUR/USD Current Price: 1.0835
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ECB's President, put a halt in risk-aversion trading this Thursday, by offering quite a dovish speech after leaving the EU economic policy unchanged. The European Central Bank opened doors for further easing, announcing a probable revision of the ongoing measures next March, giving a boost to local share markets that dragged US indexes and even commodities higher. Whether this positive mood will hold Chinese and oil upcoming onslaughts that no doubts will come back shortly, is something yet to be seen. In the meantime, Draghi also said that rates will remain at current levels or lower for an extended period of time, adding that the downside risk has increased again. Majors reversed course, with commodity currencies benefiting from the sudden comeback in stocks and goods, and the EUR and the JPY giving back some ground.
The EUR/USD pair fell down to 1.0770, but quickly bounced, meeting buying interest around the 50% retracement of the December rally, holding afterwards below 1.0845, the 38.2% retracement of the same rally. From a technical point of view, the pair seems poised to recover back towards mid-range in term, ever since the base of the latest range has held. According to the 1 hour chart, on the contrary, the risk remains towards the downside, as the price is well below its moving averages, while the technical indicators turned south after correcting extreme oversold readings. The bearish case, will remain valid as long as 1.0845 holds. In the 4 hours chart, the technical indicators are currently flat below their mid-lines, giving no clear directional clues while the price is far below its moving averages, all of which should keep the upside limited.
Support levels: 1.0800 1.0770 1.0735
Resistance levels: 1.0845 1.0890 1.0925
EUR/JPY Current price: 127.57
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The EUR/JPY pair fell to a daily low of 126.15 following the ECB's head statement, but the recovery of the common currency alongside with yen intraday weakness sent it back above the 127.00, barely trading in positive territory. The longer term outlook maintains the bearish tone alive, given that the pair has set a lower low and a lower high daily basis, while trading well below its moving averages, suggesting this recovery may well be temporal. Shorter term, the 1 hour chart shows that the advance stalled at 127.86, the 200 SMA, with the price now also below the 100 SMA and the technical indicators losing upward strength after crossing their mid-lines. In the 4 hours chart, the technical indicators lack clear directional strength, having turned slightly higher within bearish territory, while the price remains far below its moving averages.
Support levels: 123.70 126.90 126.50
Resistance levels: 127.80 128.10 128.50
GBP/USD Current price: 1.4209
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The British Pound recovered against the greenback, after extending its decline down to 1.4078 earlier in the day, its lowest since March 2009. The comeback however, seems more related with the extreme oversold conditions of the pair than anything else, although the bounce in stocks in commodities and stocks also helped. The pair enters the Asian session trading around a critical level, its 20 SMA in the 4 hours chart, as the indicator has led the way higher ever since the year started, attracting selling interest every time the price bounced towards it. In the same chart, the technical indicators have bounced from oversold levels, but remain well below their mid-lines, suggesting that so far, the movement is corrective, with former lows in the 1.4250 region being the immediate resistance. Some follow through beyond this last could see the recovery extending in the last trading day of the week, up to 1.4339, this week high.
Support levels: 1.4190 1.4145 1.4110
Resistance levels: 1.4250 1.4290 1.4340
USD/JPY Current price: 117.67
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The USD/JPY trades at a two-day high by the end of the day, set at 117.77, favored by the improved market's sentiment, but also on the back of BOJ's Kuroda recent comments, pointing that while he is not thinking on adopting a negative interest rate policy now, he remains open to continue easing until inflation is stable at 2%. The BOJ's has no plans to act immediately, but pressure is mounting towards fresh action as conditions continue to deteriorate while inflation remains subdued. From a technical point of view, the 1 hour chart shows that the price has advanced above its 100 and 200 SMAs, while the technical indicators are losing their bullish strength near overbought levels. In the 4 hours chart, further gains are still unclear, given that the price remains far below a bearish 100 SMA, currently around 128.20, while the technical indicators have turned flat below their mid-lines, lacking directional strength.
Support levels: 116.90 116.40 115.95
Resistance levels: 117.80 118.20 118.65
AUD/USD Current price: 0.6983
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The Aussie was among the most benefited by the sudden change in market's mood, advancing against the greenback up to 0.7011 intraday. Oil prices recovered towards the $30.00 a barrel region after posting fresh multi-year lows on Wednesday, with precious metal following, supporting commodity-related currencies. The pair retains the positive tone ahead of Asian opening, as the 1 hour chart shows that the price remains near its highs, and far above a strongly bullish 20 SMA, while the technical indicators consolidate near overbought levels. In the 4 hours chart, a double bottom around 0.6825 has been confirmed, given that the price is now above the neckline of the figure at 0.6960, now a key support. In the same chart, the 20 SMA is turning higher well below the current price, while the Momentum indicator holds above its 100 level, and the RSI indicator heads north around 61, supporting a continued advance, on renewed strength above the 0.7000 figure.
Support levels: .6960 0.6920 0.6870
Resistance levels: 0.7010 0.7045 0.7080
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