EUR/USD

Market kept selling the greenback this Wednesday, underpinned by FED's Yellen comments on Tuesday, stressing the need for a cautious stance on interestrate increases. The EUR/USD pair rose to 1.1364 in spite of weak data coming from Europe as the EU economic sentiment indicator decreased to 103.0 in March, missing expectations. Consumer confidence in the same month held steady at 9.7. Markets also ignored data from the US, showing that the private sector added 200,000 jobs in March according to the ADP survey, beating expectations, whilst February reading suffered a modest downward revision to 205,000.The dollar bounced some after FED´s Evans said that the accommodative policy is still appropriate, and that two interestrate hikes are possible this year, given the strength of the US economy. Seems US policy makers are determinate to confuse investors. Nevertheless, the dollar is poised to end the day sharply lower against all of its major rivals, and technical readings suggest that the latest decline in the EUR/USD pair is barely corrective, given that the price remains near this year high at 1.1375, and the level to break to confirm additional gains, while the technical indicators are retreating partially from overbought readings, far from indicating a continued decline.

Support levels: 1.1290 1.1245 1.1190

Resistance levels: 1.1375 1.1420 1.1460

EURUSD


GBP/USD

The GBP/USD pair extended its weekly gains up to 1.4458 this Wednesday, but lost nearly 100 pips in the American afternoon, as due to Pound's self weakness, the pair is more sensitive to dollar's intraday rallies. There were no macroeconomic releases, but the UK will publish the third and final GDP estimate for the final quarter of last year early Thursday. The annual rate of growth is expected to remain unchanged at 1.9%, while during the last three months of 2015, growth is expected to have been of 0.5%, as previously estimated. Should the reading beat expectations, the pair may retest this March highs around 1.4515. In the meantime, the technical picture shows that the price is holding above the 61.8% retracement of its latest daily decline at 1.4335, the immediate support. In the 1 hour chart, the price has broken below its 20 SMA, but the technical indicators have turned flat around their midlines, limiting chances of further declines in the short term. In the 4 hours chart, the technical indicators have turned south after topping at overbought levels, supporting a continued decline particularly on a break below the mentioned Fibonacci support. Nevertheless, and given that the 20 SMA has advanced further below the current level and is about to cross above the 200 EMA, the longer term outlook is bullish, and may imply buying on dips as low as 1.4250.

Support levels: 1.4335 1.4290 1.4250

Resistance levels: 1.4420 1.4460 1.4515

GBPUSD

 

USD/JPY

The Japanese Yen strengthened during the past Asian session, with the USD/JPY pair falling down to 112.01 during the European morning, as dovish words by FED's Chief Yellen kept the dollar in selloff mode for most of the day. Early news showed that Japan's preliminary Industrial production for February dropped 6.2% monthly basis and 1.5% compared to a year before, slightly below expected. Later on the day, the good employment readings coming from the US helped the pair in recovering ground up to 112.67, before it turned back south. The 1 hour chart shows that the technical indicators have turned south after reaching their midlines whilst the price hovers around a horizontal 200 SMA, far below the 100 SMA at 113.10, and the level to break to consider an upward movement. In the 4 hours chart, the price held below a mild bearish 100 SMA for most of the day, and even met selling interest on approaches to it, which reflects that sellers are still in control of the pair. In the same chart, the Momentum indicator is slowly turning south well below its 100 level, while the RSI hovers around 40, in line with the dominant bearish trend.

Support levels: 112.40 111.90 111.50

Resistance levels: 113.10 113.35 113.70

USDJPY


GOLD

Spot gold extended its weekly gains up to $1,244.05 a troy ounce this Wednesday, amid dollar's weakness and fresh buying by Asian jewelers at the beginning of the day. But the bright metal plummeted as investors unwind positions in the safehaven assets and turned into higher yielders. Spot erased most of its post Yellen gains and trades above the $1,225.00 region, a strong static support level that if it is broken once again, will put a top on gold's rally, as it will imply lower lows for the days to come. Technically, the daily chart shows that the price retreated from a bearish 20 SMA, whilst the technical indicators have failed to overcome their midlines and turned lower within bearish territory, in line with additional declines. In the 4 hours chart, the commodity is a couple of dollars above a mild bullish 20 SMA, but the technical indicators head sharply lower, with the RSI already below 50, also supporting a new leg south for this Thursday.

Support levels: 1,225.00 1,213.90 1.206.90

Resistance levels: 1,238.20 1,246.00 1,253.75

XAUUSD


WTI CRUDE

US crude oil futures started the day with a strong footing, reaching $39.82 a barrel, but gave back its gains to end roughly flat around $38.30, as another weekly build in US inventories spooked investors. According to the EIA, the US added 2.3 million barrels in the week ended March 25th, while the American Petroleum Institute reported a 2.6 million barrels increase late Tuesday. Also, affecting the commodity was a private survey suggesting that the OPEC output rose this month. Technically, the bias is bearish, as the price faltered in its recovery around its 200 DMA, while closing the day also below the 20 DMA, as the technical indicators pressure their midlines. Shorter term, the 4 hours chart shows that the price is also below a bearish 20 SMA, whilst the technical indicators lack clear directional strength within negative territory. Tuesday's low at 37.90 is the immediate support and the level to confirm a new leg south towards the 35.00 region.

Support levels: 37.90 37.40 36.80

Resistance levels: 39.20 39.90 40.4

WTI Crude


DAX

European stocks popped on Wednesday, with the German DAX ending the day up by 1.60% at 10,046.61, after FED's Yellen dampened expectations of a rate hike in the US. Among the daily winners was retailer Metro, up by over 9% on news that the conglomerate will split its food and consumer electronics businesses which could be just the trigger for more dramatic M and A. SMA Solar Technology also climbed 9% after announcing a 24% increase in sales during 2015. Despite closing above the 10,000 mark, the index is still unable to leave the congestion zone where it has traded for most of this March, and a trend outcome is not yet clear. Nevertheless, the daily chart presents a positive tone, as the technical indicators have bounced from their midlines and maintain bullish slopes, whilst the index developed above a bullish 20 DMA. The 100 DMA is still a strong dynamic support, now at 10,114. In the 4 hours chart, the neutral tone prevails, as the index is above a horizontal 20 SMA, whilst the technical indicators lack directional strength, and hold around their midlines.

Support levels: 10,010 9,940 9.835

Resistance levels: 10,114 10,184 10,225

DAX


DOW JONES

Wall Street continued advancing this Wednesday, with the Dow Jones Industrial Average adding 83 points to close at 17,716.66, a fresh year high, the Nasdaq surging 0.47% to end at 4,869.29 and the S and P up by 8 points, to end at 2,063.95. Yellen's dovish stance over upcoming rate hikes benefited stocks, as a weaker dollar, makes US shares more attractive. At this point, the index is poised to extend its advance and retest the key 18,000 region, supported by the daily technical picture, as the 20 SMA keeps heading north well below the current level, whilst the RSI and the Momentum indicators have turned higher after a limited downward correction. In the 4 hours chart, the 20 SMA has accelerated its advance below the current level, the Momentum indicator heads strongly higher within bullish territory, while the RSI stands path around 66, all of which supports the dominant bullish trend.

Support levels: 17,652 17,581 17,502

Resistance levels: 17,790 17,865 17,924

Dow Jones


FTSE 100

The FTSE 100 added 98 points or 1.59% to close the day at 6,203.17, the highest close for this 2016. Commodity related shares led the way higher, as base metal and oil rallied on a weaker dollar. Anglo American surged by 11.8% and BHP Billiton added 6.0%. The daily chart shows that the index has extended its rally beyond a now bullish 20 SMA, whilst the technical indicators have bounced from their midlines, and head slightly higher, all of which limits the downside, but at the same time, lacks enough strength to confirm an upward continuation. In the same chart, the 200 DMA holds at 6,253, offering a strong dynamic resistance for this Thursday. In the 4 hours chart, the index is above a horizontal 20 SMA, whilst the Momentum indicator remains flat around its 100 level, and the RSI heads lower around 57, overall neutral.

Support levels: 6,175 6,112 6,087

Resistance levels: 6,239 6,268 6,326

FTSE

The information set forth herein was obtained from sources which we believe to be reliable, but its accuracy cannot be guaranteed. It is not intended to be an offer, or the solicitation of any offer, to buy or sell the products or instruments referred herein. Any person placing reliance on this commentary to undertake trading does so entirely at their own risk.

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