EUR/USD: stuck mid-range, waiting for a trigger

EUR/USD Current Price: 1.0956

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The week started in slow motion, with the dollar advancing particularly against its European rivals. During the weekend, the Chinese National People’s Congress set out a growth rate of 6.5% to 7.0% for the next year, spurring some risk averse trading during the first half of the day. The EUR was also affected by soft local macroeconomic figures, as German factory orders decreased by 0.1% in January, better than the 0.5% decline expected, but down for a second month in a row. In the EU the Sentix Investor Confidence index for March came in at 5.5, below the 8.0 expected and the previous 6.0. The American session will offer a couple of speeches of FOMC members,  but no relevant macro data until late in the local afternoon, when the country will release the consumer credit change for January.

As for the technical picture, the EUR/USD pair has been unable to sustain gains above the 1.1000 figure, and trades near a daily low set at 1.0939 ahead of the US opening. In the 1 hour chart, the pair has met some short term buying interest on a first test of its 200 SMA, the immediate support, while the 20 SMA has turned south above the current level. The technical indicators in the mentioned time frame lack clear directional strength within bearish territory, all of which indicates little buying interest at the time being. In the 4 hours chart, the price remains above a bullish 20 SMA, while the technical indicators have retreated from overbought levels, but turned horizontal above their mid-lines, denying chances of a stronger decline as long as the price holds above the 1.0920 level, the immediate support. 

Support levels: 1.0920 1.0880 1.0845

Resistance levels: 1.1000 1.1050 1.1090

GBP/USD Current price: 1.4132

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The British Pound is losing ground against the greenback at the beginning of the week, retreating from a major static resistance level, the 1.4250 region, tested last Friday after the mixed US employment report. With no data scheduled in the UK, the pair will likely trade on sentiment during the upcoming session, with the risk turning south on increasing risk aversion. Technically, the 1 hour chart shows that the pair is consolidating near its daily low, with the 20 SMA heading lower around 1.4190, the immediate resistance. In the same chart, the technical indicators aim higher, bouncing from near oversold levels, but well below their mid-lines. In the 4 hours chart, however, the upside seems more constructive, given that the pair has recovered after testing a bullish 20 SMA, whilst the technical indicators have turned north after testing their mid-lines. Additional recoveries beyond the mentioned 1.4190, should keep the upside favored, with scope then to retest the mentioned 1.4250 region later today.

Support levels: 1.4135 1.4100 1.4060

Resistance levels: 1.4190 1.4220 1.4250

USD/JPY Current price: 113.56

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Yen strengthening on BOJ's inaction. The Japanese yen advanced against most of its major rivals, helped by sliding stocks and an on-hold stance from the BOJ. Governor  Kuroda said on Monday that the Central Bank will asset the effects of negative interest rates, suggesting no additional measures are currently planned, whilst maintaining his optimistic outlook for the country's economic outlook. The USD/JPY pair fell down to 113.39 before recovering some, now stuck around the 23.6% retracement of its latest daily slump at 113.50, and with an increasing short term bearish potential, given that in the 1 hour chart, the pair is developing below its 100 SMA, around 113.80, while the technical indicators are resuming their declines within negative territory. In the 4 hours chart, the RSI heads strongly south around 47, but the Momentum indicator lacks strength, horizontal below its mid-line, suggesting a limited intraday range for this Monday.

Support levels: 113.10 112.70 112.35

Resistance levels: 113.80 114.25 114.60 

AUD/USD Current price: 0.7421

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The Australian dollar retains its positive tone, recovering ground after starting the day with a downward gap against the greenback, weighed by Chinese news. The AUD/USD fell as low as 0.7391 before regaining the 0.7400 level, now again heading towards the roof of its daily ascendant channel, today in the 0.7450 region. The short term technical picture supports some further gains, given that in the 1 hour chart, the price recovered above a horizontal 20 SMA, while the technical indicators head slightly higher above their mid-lines. In the 4 hours chart, the price is well above a sharply bullish 20 SMA, whilst the RSI indicator continues to consolidate within overbought territory. The momentum indicator in this last time frame however, diverges lower, but still well above its mid-line, limiting the upside, but far from suggesting a downward move. 

Support levels: 0.7390 0.7345 0.7310

Resistance levels: 0.7450 0.7490 0.7530