Aud still looking good for Head/ Shoulder objective at around 0.9580. Home Loans/Consumer Confidence today; Jobs numbers tomorrow.
The dollar was under pressure on all fronts today ahead of the FOMC minutes, due later in the NY session. Cable, Aud and the Yen all had a strong run higher.The Euro, Chf and Kiwi also performed well and the DXY looks once more to have failed on the topside. Today, apart from the FOMC Minutes, markets will focus on secondary EU/US data, while in Asia we get the WBC Consumer Confidence and Home Loans data.
EUR/USD: 4 hour
USD/JPY: 4 hour
GBP/USD: 4 hour
USD/CHF: 4 hour
AUD/USD: 4 hour
NZD/USD: 4 Hour
The dollar was under pressure on all fronts today ahead of the FOMC minutes, due later in the NY session. Cable, Aud and the Yen all had a strong run higher.The Euro, Chf and Kiwi also performed well and the DXY looks once more to have failed on the topside. Today, apart from the FOMC Minutes, markets will focus on secondary EU/US data, while in Asia we get the WBC Consumer Confidence and Home Loans data.
EUR/USD: 1.3796
The Euro finally took out the stops above 1.3750, climbing to a high of 1.3810, so far, against the dollar, which was under pressure on all fronts ahead of the FOMC Minutes, later today.
The minutes are unlikely to add anything different from Janet Yellen’s press conference, unless her comments that rates may be raised in “6 months”, as she alluded to, are mentioned.
Technically the Euro, having broken 1.3800, has run into headwinds ahead of 1.3820 where the 50% pivot of the decline from 1.3966/1.3675 and descending trend resistance converge. A break of this would see a move on towards 1.3855 (61.8%) and the 24 March spike high at 1.3875. The hourly charts are now rather overbought though, so further progress may slow and I suspect that the upside may be somewhat limited today, but if wrong, beyond there would head towards 1.3900 (1.3895 :76.4% of 1.3966/1.3675), above which would suggest a retest of 1.3966 and eventually 1.4000.
With the 4 hour charts looking positive, the downside looks a bit limited today as well, and 1.3780 will now provide the first, minor support ahead of 1.3750. Below there would see a run back towards 1.3725 and 1.3700
Further out, below 1.3700, bids at around Friday’s low at 1.3675 will be strong support, being where several indicators converge, including the top of the daily cloud, the 100 DMA, the 23.6% retracement of 1.2753/1.3966 and the rising trend support from the 1.2753 low. A break of this though, would head back towards the Fibo support at 1.3660 (61.8% of 1.3475/1.3966) below which, the 27 Feb low at 1.3643 will come into view ahead of the 76.4% Fibo support at 1.3595. Below there would head towards the 200 DMA at 1.3525 although tat this point it is over the horizon.
For the time being look for 1.3770/1.3820 to cover it, but it does look as though once again the dollar is going to fail on the topside and that the Euro could push higher. Keep an eye out for the DXY (79.90). A daily/weekly close below 79.75 (200WMA) could bring about a more substantial decline and send the Euro higher once again.
Economic data highlights will include:
German Current Account, US Wholesale Inventories, FOMC Minutes
Meta Trader – AxiTraderEUR/USD: 4 hour
USD/JPY: 101.70
The dollar fell sharply against the yen today, as did the crosses, as hopes for additional stimulus from the BOJ faded after Governor Kuroda said that there was no need for more monetary support to avoid deflation. The BOJ announced that there would be no change in policy and kept rates steady.
The dollar has been down to 101.54 where it finally found support at the 76.4% decline of the rise from 100.75/104.12. The hourly charts are now oversold and so downside progress may slow somewhat from here, but the intraday indicators are all pointing sharply lower still, and thus it does look as though rallies are a sell opportunity for a decline, eventually below the session lows, and on towards the support at the double bottom at 101.20 (blue line). Corporate Japanese demand the last time we were down here was very strong and provoked a sharp upside correction, so we need to be careful of being too short running into this level. If it were to give way though, then we should expect a run towards 101.00 and probably to the 4 Feb low at 100.75, roughly where rising trend support and 200 DMA also lie, and thus should be strong support.
On the topside, resistance will now be seen at the base of the daily cloud at 102.05 ahead of the first minor Fibo retracement levels of the fall from 104.12, at 102.15 and 102.50.
Some sort of minor retracement would not surprise, but selling into the 102.00/50 area would seem to be the plan now, for an eventual look at 101.20 (weekly Kijun) and possibly lower. Keep a close eye on the Nikkei, as, after yesterdays 1.4% decline, the futures have had a move of similar proportions. Another day of the same would see the pressure stay heavily on the dollar.
Economic data highlights will include:
BOJ Monthly Economic Survey
Meta Trader – AxiTraderUSD/JPY: 4 hour
GBP/USD: 1.6745
Having closed the previous session above the daily cloud at 1.6605, the better than expected UK Industrial Production data (0.9% vs 0.3% exp m/m) propelled Sterling strongly higher, with thoughts turning to the possibility that the UK will most likely be the first major economy to begin raising rates sometime near H2 2015.
Cable is currently sitting just off session highs of 1.6754, meaning that the descending trend resistance has been broken, potentially allowing for a retest of the 14 Feb 1.6821 high.
The hourly charts are at overbought extremes and the upside potential in the near term looks limited, so we could see some consolidation or possibly a minor retracement while it works out its next directional move, and some choppy trade ahead of Thursday’s BOE meeting would not surprise (No change to rates/APP expected).
The points to watch, on the topside, are at 1.6755 and then the 7 March high at 1.6782. Beyond there, heads to 1.6800 and 1.6821, although I would be surprised to see Cable up here today.
On the downside, minor Fibo support of the rise from 1.6551 is seen at 1.6706 and then at 1.6675, which also looks unlikely today.
Use 1.6710/80 as a guide today, as I think we may be in for a session of hanging around for the BOE tomorrow, but with the UK trade balance and the FOMC minute likely to provide any interim volatility.
Economic data highlights will include:
UK Goods Trade Balance
Meta Trader – AxiTraderGBP/USD: 4 hour
USD/CHF: 0.8835
The dollar has broken down through various technical levels, until finding some support at the daily Kijun (0.8825), but which judging by the 4 hour charts could come in for a more severe workout later in the day. A break would see a run towards 0.8800 (0.8795: 61.8% of 0.8695/0.8953)and then possibly to 0.8760 (76.4%).
On the topside, the 200 HMA at 0.8870 and the 100 HMA at 0.8885 provide the initial resistance ahead of 0.8900, which looks a bit unlikely.
The dollar bullishness of earlier in the week is tempered somewhat by the daily indicators flattening out and more likely, the choppy conditions of recent week’s look set to continue, and for today I would look to 0.8790/0.8860 to provide a guide.
Meta Trader – AxiTraderUSD/CHF: 4 hour
AUD/USD: 0.9358
The Aud has continued to run higher, despite the Yen strength, reaching a peak of 0.9365 as the US$ was generally soft, while emerging market currencies retained their bid tone.
Momentum for the Aud still points higher, although ahead of tomorrow’s Jobs data the pace may slow down somewhat. We do get the WBC Consumer Confidence and Home Loan data later today though, and a positive reading there would underpin the Aud and potentially push it on to 0.9400.
Before then though, having taken out the resistance at 0.9340, the next level to watch will be 0.9387 (38.2% of 1.0582/0.8660). Beyond 0.9400, there is not a lot ahead of 0.9450 (weekly cloud base) and 0.9494 (76.4% of 0.9757/0.8660). Looking for a run towards the SHS target at 0.9580 remains the strategy.
On the downside, 0.9340 will now provide support ahead of 0.9310. Under 0.9300 will find buyers at 0.9280 (23.6% of 0.9005/0.9365). I don’t think we are heading back down here yet, but if wrong further bids would be seen at around 0.9265 100/200 HMA’s.
Look once more to buy dips towards 0.9300 for an eventual break of 0.9400 and a run to the weekly cloud base at 0.9450.
Economic data highlights will include:
WBC Consumer Confidence , Australian Home Loans, Investment Lending
Meta Trader – AxiTraderAUD/USD: 4 hour
NZD/USD: 0.8670
The Kiwi has been dragged higher by the Aud (and the commodity bloc in general) today, trading to a high at 0.8681 before reversing slightly to end the NY session at 0.8668.
A continuation of the move higher could again test 0.8700 and possibly higher, although ahead of the FOMC minutes I doubt it will make such a move.
On the downside, 0.8640 is the first minor Fibo support, ahead of 0.8615 and 0.8600.
I suspect that we are in for a day of 0.8650/0.8700 but once again buying dips appears to be the plan.
Meta Trader – AxiTraderNZD/USD: 4 Hour
Recommended Content
Editors’ Picks
EUR/USD holds below 1.0750 ahead of key US data
EUR/USD trades in a tight range below 1.0750 in the European session on Friday. The US Dollar struggles to gather strength ahead of key PCE Price Index data, the Fed's preferred gauge of inflation, and helps the pair hold its ground.
GBP/USD consolidates above 1.2500, eyes on US PCE data
GBP/USD fluctuates at around 1.2500 in the European session on Friday following the three-day rebound. The PCE inflation data for March will be watched closely by market participants later in the day.
Gold clings to modest daily gains at around $2,350
Gold stays in positive territory at around $2,350 after closing in positive territory on Thursday. The benchmark 10-year US Treasury bond yield edges lower ahead of US PCE Price Index data, allowing XAU/USD to stretch higher.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
US core PCE inflation set to signal firm price pressures as markets delay Federal Reserve rate cut bets
The core PCE Price Index, which excludes volatile food and energy prices, is seen as the more influential measure of inflation in terms of Fed positioning. The index is forecast to rise 0.3% on a monthly basis in March, matching February’s increase.