EUR/USD: mute above 1.1000

EUR/USD Current Price: 1.1023

The EUR/USD pair holds above the 1.1000 region in a dull trading session, with uncertainty over the upcoming ECB decision keeping the common currency subdued. The day started with China triggering some risk aversion, as trade balance data came in much worse than expected, reflecting further slumps both in exports and imports during last February. Nevertheless, European stocks reversed early losses and trade slightly below their daily openings. Data coming from Europe this Tuesday was better-than-expected, with German Industrial Production rising 3.3% monthly basis last January, and the EU GDP ticking up to 1.6% yearly basis, but in line with expectations during the last quarter of 2015, up by 0.3%.

Ahead of the US opening, the 1 hour chart shows that the pair maintains a limited upward potential, as the price hovers around a horizontal 20 SMA and the technical indicators are aiming to recover from neutral territory. In the 4 hours chart, the technical outlook also favors the upside, given that the price is above a bullish 20 SMA and the RSI turned north after a limited downward correction near overbought territory. In this last time frame, however, the Momentum indicator diverges lower, limiting the upside. The pair needs to accelerate beyond the 1.1045 level, where the rallies stalled the last two trading days, to be able to extend its gains up to the 1.1080/1.1120 region.

Support levels: 1.0980 1.0950 1.0920

Resistance levels: 1.1045 1.1080 1.1120

GBP/USD Current price: 1.4197

View Live Chart for the GBP/USD

The GBP/USD pair trades near the 1.4200 level, easing from the 1.4283 posted late Monday. The UK calendar has been quite light this week, but next Wednesday, the release of the latest manufacturing and industrial production figures will offer a clearer picture of the kingdom's health. In the meantime, and despite broad dollar's weakness, the short term picture for the pair is bearish, with the price breaking through the 1.4200 level and the 1 hour chart showing that the price is accelerating below a bearish 20 SMA, whilst the technical indicators head south well below their mid-lines. In the 4 hours chart, the price is now pressuring a bullish 20 SMA after being rejected by the 200 EMA, while the technical indicators head south within positive territory, not yet confirming a stronger decline.

Support levels: 1.4190 1.4150 1.4110

Resistance levels: 1.4220 1.4260 1.4290

USD/JPY Current price: 113.04

View Live Chart for the USD/JPY

Bearish case improving. The USD/JPY pair fell briefly below the 113.00 level, and currently hovers around it, with the downside limited as stocks trim early losses. Risk aversion has dominated the financial world during the Asian session, with local share markets plummeting on further signs of a Chinese economic slowdown, this time in the form of poor trade balance figures. The negative sentiment however, recede during the European morning, and continues improving ahead of the US opening. Nevertheless, the pair maintains the technical bearish stance, now below the 23.6% retracement of the latest bullish run, at 113.50, and in risk to retest the lows set at 111.00. Short term, the 1 hour chart shows that the price is well below its 100 and 200 SMAs, while the Momentum indicator heads south below the 100 level, and the RSI indicator hovers around 43. In the 4 hours chart, the technical indicators have lost the downward potential within bearish territory, whilst the price is in consolidative mode below the 100 SMA, all of which favors additional declines on a break below 112.70, the immediate support.

Support levels: 112.70 112.35 112.00

Resistance levels: 113.20 113.50 113.95

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