EUR/USD Current Price: 1.1110
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The American dollar sold-off this Wednesday, as tepid US data joined forces with technical breakouts in major pairs. The greenback was already under pressure before Wall Street's opening bell, with the EUR and the JPY leading higher, amid poor stocks' performance fueling risk aversion. Mostly, investors were dumping the dollar on increasing worries about the economic slowdown seen late 2015 extending into early 2016. The release of the US services PMI figures fueled the decline, as according to Markit economics, the US services activity growth eased to its weakest for 27 months in January, by printing 53.2. The official figure, the ISM Non-manufacturing PMI for the same month, fell to 53.5 from December's 55.3. The ADP survey showed that the private sector added 205K new jobs in January, beating expectations of 195K, growing at the slowest pace since October. Things are not better in Europe, with weak services PMIs readings and poor EU Retail Sales in December, up just 0.3% in the month. Seems speculators believe they may have rushed to price in the 4 rate hikes promised by the FED, and are quickly unwinding positions.
The EUR/USD pair rallied beyond the 1.1100 figure for the first time since past October, and set at 1.1145,having advanced almost 250 pips daily basis, the best EUR performance ever since the December ECB's announcement of a QE extension. The pair has broken beyond its 200 DMA, at 1.1050, now a major support level. In the 4 hours chart, the technical indicators are barely losing upward strength in extreme overbought territory, while the price is far above its moving averages, after the intraday run. The pair has briefly extended beyond a major static resistance around 1.1120, which should contain rallies at least in the short term. Renewed buying interest above it, however, will likely fuel the rally towards the 1.1200 region, the main bullish target for this Thursday.
Support levels: 1.1050 1.1010 1.0970
Resistance levels: 1.1120 1.1160 1.1200
EUR/JPY Current price: 130.45
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The Japanese yen erased most of its post-BOJ losses against its major rivals, and despite strong EUR demand, the EUR/JPY fell down to 130.03 during the US session. The JPY gained as US stocks plunged this Wednesday, with investors spooked by slowing growth news. Technically the 1 hour chart for the EUR/JPY shows that the price is below its 100 SMA, but stalled above a bullish 200 SMA, currently around 129.80, while the technical indicators aim slightly higher below their mid-lines, lacking directional strength. In the 4 hours chart, however, the technical picture is clearly bearish, as the technical indicators present bearish slopes well below their mid-lines, while the 100 SMA remains far below the 200 SMA.
Support levels: 129.80 129.35 128.80
Resistance levels: 130.40 130.85 131.20
GBP/USD Current price: 1.4603
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The GBP/USD trades at fresh 4-weeks highs, a handful of pips above the 1.4600 figure. The Pound got an early boost during the European morning, as the Markit services PMI report for January showed that the sector continue to lead the UK recovery, up to 55.6 against the 55.5 previous, and the 55.3 expected. The pair's rally accelerated after breaking above 1.4530, which stands for the 38.2% retracement of the 1.5110/1.4078 decline between December and January. Short term, the 1 hour chart shows that the 20 SMA advanced alongside with the price, but stands well below the current level, while the technical indicators resumed their advances within extreme overbought territory. In the 4 hours chart, the technical indicators are losing upward extreme in overbought territory, the 20 SMA heads higher far below the current level, and the 200 EMA converges with the mentioned Fibonacci level at 1.4530, first time above it since mid December. Retracements down to this last level should be now seen as buying opportunities, while additional gains can be confirmed on a break above 1.4660, the 50% retracement of the mentioned decline.
Support levels: 1.4530 1.4490 1.4450
Resistance levels: 1.4565 1.4600 1.4640
USD/JPY Current price: 117.34
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The Japanese yen rally seems unstoppable, with the USD/JPY pair down over 270 pips this Wednesday, and now trading around 117.34, its lowest since January 21st. Risk aversion is supporting yen's strength, but also falling US yields, as 10y ones are at 1.85%, 0.48% lower in the day. The 1 hour chart for the pair shows that the technical indicators maintain strong bearish slopes below their mid-lines, while the price plunged below its 100 and 200 SMAs. It also shows that the price is bouncing from a daily low seta t 117.04, but remains below 117.65, January 26th daily low and the immediate resistance. In the 4 hours chart, the technical indicators maintain their sharp bearish slopes within extreme oversold levels, while the price retraced over 61.8% of its latest daily bullish run between 115.96 and 121.68, pointing for a continued decline towards the low of the range.
Support levels: 117.05 116.60 116.20
Resistance levels: 117.65 117.90 118.40
AUD/USD Current price: 0.7181
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The Australian dollar soared to its highest since early January against the greenback, with the pair trading as high as 0.7186 during the American afternoon. Dollar's sell-off resulted in the pair breaking above the 100 DMA for the first time since January 6th, currently at 0.7156, offering an immediate support. The greenback's decline accelerated earlier in the day, as New York Fed President Bill Dudley said Wednesday that financial conditions have tightened since the Fed raised interest rates in December. The AUD/USD holds near its daily highs, and in the 1 hour chart, the technical indicators are beginning to look exhausted in extreme overbought territory. Nevertheless the pair broke above the 61.8% retracement of its latest daily slump at 0.7145, and as long as the price holds above it, the upside will remain favored. In the 4 hours chart, the technical indicators present a strong upward momentum and are currently approaching overbought levels, while the price has extended well above a now bullish 20 SMA, in line with the shorter term view.
Support levels: 0.7135 0.7100 0.7060
Resistance levels: 0.7200 0.7245 0.7290
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