EUR/USD: EUR mute, plenty of action elsewhere

EUR/USD Current Price: 1.0863

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Markets are extremely active this Tuesday, but the common currency is unable to react, not to news neither to sentiment, trading within a tight range against the greenback ahead of the US opening. The EUR/USD pair has spiked up to 1.0904 earlier in the day, but the pair remains above 1.0845, the immediate support as per being the 38.2% retracement of the December bullish run. The data released this morning showed that the EU inflation matched expectations, flat in December compared to the previous month, and up by 0.2% in the same month, but compared to a year before. The German ZEW survey surprised with some improvement in local sentiment, although when it comes to the region, it was a big miss, printing 22.7 against the 27.9 expected and the 33.9 previous. 

With only the TIC flows for November ahead in the US, the short term technical picture for the pair is bearish, given that in the 1 hour chart, the price is extending below its moving averages, with the 20 SMA crossing below the 100 and 200 ones, above the current price, while the technical indicators head lower below their mid-lines. In the 4 hours chart, the Momentum indicator has crossed its mid-line towards the downside, while the price is right below its moving average, all together in a tight range and lacking directional strength. Should the price extend below 1.0845, the pair will likely test the 1.0800 level, where buying interest has been defending the downside.

Support levels: 1.0845 1.0800 1.0760

Resistance levels: 1.0925 1.0965 1.1000 

GBP/USD Current price: 1.4209

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The reasons beyond the latest Pound´s decline has become even more clear this Tuesday, as the currency plummeted to fresh multi-year lows against its American rival, following a dovish statement coming from BOE's head, Mark Carney. The leader of the Central Bank stated that is no time to raise rates, triggering a 100 pip decline in less than an hour. He also said that domestic demand is solid, but that consumption remains resilient. Earlier in the day, news showed that the UK CPI rose by 0.2% in the year to December 2015, compared with a 0.1% rise in the year to November 2015, while house prices increased by 7.7% in the year to November 2015, up from 7.0% in the year to October 2015, although the PPI came out negative, and worse than-expected. 

The GBP/USD pair trades at levels last seen in March 2009, and is poised to extend its decline, pressuring the lows and with the 1 hour indicators heading lower within bearish territory. In the same chart, the price is back below a now bearish 20 SMA, now around 1.4260. In the  4 hours chart, the pair was rejected once again by a strongly bearish 20 SMA, now around 1.4300, while the technical indicators turned sharply lower after correcting oversold readings, and in line with further declines, supporting a break below the 1.4200 figure for the upcoming hours.  

Support levels: 1.4185 1.4140 1.4100

Resistance levels: 1.4260 1.4290 1.4320 

USD/JPY Current price: 117.86

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Short term bullish towards 119.00. Despite poor Chinese data released at the beginning of the day, investors have been dropping the safe haven yen, and  the USD/JPY pair has been tracking stocks in its way higher, now retreating from its daily high of 118.10. Technically, the 1 hour chart shows that the price is above the 100 and 200 SMAs that anyway maintain a negative tone, while the indicators have retreated from overbought levels, and then turned horizontal within positive territory, not yet confirming additional declines. In the 4 hours chart, the price stalled short from a strongly bearish 100 SMA around 118.60, while the technical indicators are losing their bullish slope above their mid-lines. The pair will likely follow Wall Street during the upcoming US session, and advance to fresh daily highs, but the background is still dominated by bears, with a break below 117.40 now required to see the pair resuming its slide. 

Support levels: 117.40 116.90 116.50 

Resistance levels: 118.10 118.60 119.00

AUD/USD Current price: 0.6930

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Improved market's sentiment has helped the Aussie advance up to 0.6956 against the greenback, a fresh weekly high for the pair, and in spite poor Chinese data. The day started with a hurdle of negative data coming from the second world's largest economy, showing that  industrial production growth slowed to 5.9% y/y from 6.2%, fixed investment to 8.3% y/y from 10.2%, GDP to 6.8% y/y from 6.9%, and retail sales slowed to 10.7% from 11% in real terms, ending the 2015 with the weak tone that prevailed all through the second half of the year. Short term, the 1 hour chart maintains a bullish tone, given that the technical indicators head higher near overbought territory after a limited downward correction, as the price advances well above a bullish 20 SMA. In the 4 hours chart, the price is above its 20 SMA and the Momentum indicator heads higher above the 100 level, although the RSI turned lower around its mid-line, limiting chances of further advances at the time being. 

Support levels: 0.6906 0.6860 0.6825  

Resistance levels: 0.6960 0.7000 0.7040