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Yesterday, the price of bitcoin surged to almost $12,000, a level it last touched months ago. The surge was attributed to several positive news that came out this week. On Monday, the state of Wyoming passed a bill relaxing securities law for some tokens. In South Korea, a country which led to the drop of bitcoin, changed tune. A government minister said the country would support and even encourage crypto operations provided they operated as normal transactions.

The positive news on bitcoin is a step in the right direction for people bullish on the currencies. Now that regulators in the United States and South Korea have given a – sort of – support for the currencies, there is a likelihood that they will continue moving higher.

This week, if bitcoin crosses the $12,000 level, there is a likelihood that bulls will continue pushing it higher.

The euro remains under selling pressure against the U.S dollar in early Wednesday trading, with price-action now consolidating around the critical 1.2330 support level. The EURUSD pair has been sold on upside rallies toward the key 1.2363 resistance level, as the U.S dollar index continues to move higher across the board. During today’s European trading session PMI Manufacturing data from across the eurozone will be released, with preliminary figures for the month of February in focus.

The EURUSD pair is likely to come under further selling pressure below the 1.2330 level, key technical support is found at the 1.2292 and 1.2270 levels.

If price-action can move above the the 1.2363 resistance level for a sustained period, buyers may attempt to re-test the 1.2390 resistance level

The U.S dollar has continued to advance higher against the Japanese yen currency overnight, hitting 107.85, driven by rising Japanese stock prices and rising U.S bond yields. The USDJPY trades close to the price-highs of the day, with bullish momentum accelerating in the pair after the 107.30 level was clearly breached. Going forward, USDJPY traders look towards the key 90.00 level on the U.S dollar index and await the release of the FOMC Meeting Minutes later today.

The USDJPY pair is strongly bullish while trading above the 107.30 level, intraday resistance is now found at the 108.01 and 108.50 levels.

Should the USDJPY pair decline below the 107.30 level, sellers may test toward the 107.00 and 106.60 support regions.

In the past five days, the Australian dollar has lost almost a percentage point against the U.S. dollar. The downward streak is continuing after the Australian Bureau of Statistics released wage growth numbers. According to the organization, the last quarter's wage price increased by 0.6%, which is higher than the 0.5% expected by traders. However, the annualized growth rate of 2.1% missed the 2.2% forecast by analysts. The AUD/USD pair is now trading at 0.7857, which is 30 basis points lower. Later today, the pair will likely be influenced by the data that comes from the United States including the existing home sales and PMIs.

The EUR/USD pair is little changed as traders wait for important economic data from the European Union and the United States. In the early hours, we will get the manufacturing and services PMI data from Germany. Traders expect the manufacturing activity in Germany to slow to 60.6, down from 61.1 reported in the previous month. They also expect the services activity to slow to 57 from last month's 57.3. In the afternoon, the same data will be released in the U.S where traders expect manufacturing PMI to slow to 55.4 compared to last month's 55.5. They expect the services PMI to move up from 53.3 to 54.0. The biggest news of the day will be the FOMC minutes which will give us a better direction of the Fed.

The cable is also little changed as traders wait for major wages and inflation-related data from the UK. In the morning hours, the ONS will release the wage growth numbers. Traders expect the average hourly wage growth without bonuses to remain unchanged at 2.4%. Wages with bonuses are also expected to remain unchanged at 2.5% while the claimant count is expected to fall to 4.1K. In the afternoon, BoE officials will address legislators on inflation.

AUD/USD

Challenging economic data from Australia, coupled with a strengthening dollar have made it difficult for the AUD/USD pair to continue its upward trend. Today, the pair continued its downward movement following the release of wage growth numbers. The next price target for the pair is likely 1.7802, which is the 11.40% Fibonacci Retracement level. However, this will be mostly determined by the data from the US later today.

EUR/USD

The strong dollar, caused partly by higher U.S treasury yields pushed the EUR/USD pair lower. Indicators imply that the pair could continue the downward trend. As shown below the, arrangement of the long and short term moving averages indicate that the pair could continue moving down. The pair is now at an important Fibonacci Retracement level of 61.8% and there is a likelihood that it might drop to the 70.70% level at 1.2307.

GBP/USD

The cable is at an inflection point. In the past one week, it has fallen from a high of 1.4145 and dropped to a low of 1.3931. As shown below, the pair's symmetrical triangle pattern is almost over as traders wait for the employment and inflation data to be released today. At this point, since the data could go either way, traders should take a wait and see attitude.

Currency pair EUR/USD

The EUR/USD is probably building a WXY corrective pattern within wave 4 (purple) unless price breaks below the support levels (green/blue), which could indicate that price has completed the 5th wave (purple) at the most recent high.

The EUR/USD seems to be in a bearish ABC (green) zigzag.

Currency pair GBP/USD

The GBP/USD bullish breakout above resistance (red) could indicatea continuation within wave 5 (green) whereas a bearish break below support (green/blue) could indicate a new downtrend.

The GBP/USD is challenging the 61.8% Fibonacci level of wave 4 (blue).

Currency pair USD/JPY

The USD/JPYis still retesting the resistance levels of the downtrend.

The USD/JPY is probably in a correction within potential wave 4 (orange) unless price breaks above the 61.8% Fib and the previous bottom (red).

Headlines/Economic Data

General Trend: Asian equity markets trade generally higher, despite declines in the US (*reminder: NYSE was closed on Monday for holiday)

Taiwan's Taiex opens over 1% higher in catch-up rally after return from Lunar New Year break

Equity markets later pare gains

Australian commodity related companies decline after earnings reports (BHP, Fortescue, Santos)

Australia sells 10-year bonds at higher yield and lower bidto cover

Thailand reports 2nd straight customs trade deficit in Jan amid higher imports

Shanghai Composite resumes from Lunar Year Break on Thursday

Aussie and Australia bond yields unable to hold onto gains post wage price data

US Dollar (USD) trades generally firmer ahead of FOMC Minutes

Japan

Nikkei 225 opened +0.1%; closed +0.2%

Topix Electric Appliances Index +0.7%, Iron & Steel +0.6%; Securities -1.2%

Mega-banks trade generally lower

(JP) Japan reportedlyconsidering raising ¥2,000 ($19) casino entry fee - Japanese press

(JP) Japan Currency Head Asakawa: Reiterates yenmoves are one sided

(JP) Japan Feb prelim PMI Manufacturing: 54.0 v 54.8 prior

(JP) Japan PM Abe seeking more stimulus to support economy beyond Olympics, he raised thetopic at a meeting of the Council on Economic and Fiscal Policy –

Nikkei.Abe is preparing another round of economic stimulus to offset downward pressure following the consumption tax hike scheduled for October 2019 and the Olympics in 2020.

(JP) BoJ Funo: Takes time to improve productivity; no need to be pessimistic onJapan's economy

Coca-Cola Bottlers Japan, 2579.JP Ricoh to sell stake in Coca-Cola Bottlers back to the company for ¥55.9B(~9.2% stake)

(JP) Japan Dec All Industry Activity Index M/M: 0.5% v 0.4%e

Korea

Kospi opened +0.1%

Automakers trade generally higher: GM said to be willing to invest $2.8B in Korean unit

(KR) Bank of Korea (BOK) Gov Lee: US tradeprotectionism is stronger than expected; prepared for faster than expected USrate hikes

(KR) South Korea Jan PPI M/M: 0.4% v 0.1% prior; Y/Y: 1.2% v 2.3% prior

(KR) South Korea Feb first 20-days Exports -3.9% y/y; Imports +13.6% y/y

(KR) North Korea officials have cancelled planned meeting with US VP Pence

GM South Korea Gov't Official: GMwilling to make $2.8B investment in South Korea unit in the next 10 years

China/Hong Kong

Hang Seng opened +0.6%, Shanghai Composite closed for holiday

Hang Seng Energy Index +1.5%, Financials +1.3%, Info Tech+1.2%

Australia/New Zealand

ASX 200 opened -0.3%; closed 0.0%

ASX 200 Consumer Discretionary Index +0.9%, Financials flat; Resources -2%, Telecom -1%

BHP [BHP.AU]: Declines over 4% after H1 results

Fortescue [-4%], FMG.AU Reports H1 (A$) Net 681M v 667Me; adj EBITDA 1.83b v 1.8Be; Rev 3.68B v3.7Be

SevenGroup [+12.4], SVW.AU Reports H1 (A$) underlying net 159.8M v 88.3M y/y; EBIT 223.5M v 157.9My/y; Rev 1.40B v 1.6Be

(AU) Australia Jan Westpac Leading Index M/M:-0.2% v +0.2% prior

(AU) Australia sells A$600M v A$600M indicated in 2.75% Nov 2028 bonds, avgyield 2.9052% v 2.8862% prior, bid to cover 4.50x v 5.43x prior

(NZ) New Zealand Analysis on CPTPP: Economy may benefit from CPTPP by NZ$1.2B/yr

(AU) AUSTRALIA Q4 CONSTRUCTION WORK DONE Q/Q: -19.4% V -10.0%E

(AU) AUSTRALIA Q4 WAGE PRICE INDEX Q/Q: 0.6% V 0.5%E; Y/Y: 2.1% V 2.0%E

(NZ) Incoming RBNZ Gov Orr: Comfortable with planned reforms for the RBNZ;clear communication is critically important

(AU) IMF on Australia: Sees 2018 GDP at 2.9%; 2019 3.1% - Article IV Consultation

North America

US equity markets ended lower: Dow -1%, S&P500 -0.6%, Nasdaq -0.1%, Russell 2000-0.9%

S&P500 Consumer Staples -2.3%, Utilities -1.3%

WMT Walmart.com CEO Marc Lore saidto be preparing to leave Walmart - NY Post

(US) TREASURY SELLS $28B IN 2-YEAR NOTE AUCTION;DRAWS 2.255%; BID-TO-COVER RATIO: 2.72 V 3.22 PRIOR AND 2.86 AVG OVER THE LAST 12 (highest yield since Aug 2008)

(US) Treasury $55B 4-week bills draw 1.380%, BTC 2.48 (lowest BTC since July 2008)

Looking Ahead: US FOMC Meeting Minutes and Jan Existing Home Sales to be released , along with Weekly API Crude Oil Inventories

Europe

(EU) EURO ZONE FEB ADVANCE CONSUMER CONFIDENCE:0.1 V 1.0E

Looking Ahead: Euro Zone, France and Germany Feb Prelim Services and Manufacturing PMIs due for release

UK Dec Avg Earnings and Unemployment Rate data to be released, along with Jan Claimant Count Change

Levels as of 01:00ET

Nikkei225 +0.2%, Hang Seng +1.1%; Shanghai Composite closed for holiday; ASX200 0.0%, Kospi +0.6%

Equity Futures: S&P500 -0.1%; Nasdaq 100 +0.8%,Dax -0.1%; FTSE100 +0.1%

EUR 1.2344-1.2317; JPY107.90-107.28; AUD 0.7901-0.7848;NZD 0.7355-0.7326

Apr Gold -0.2% at $1,329/oz; Apr Crude Oil -1.0% at $61.16/brl; Mar Copper -0.4% at $3.18/lb

For the 24 hours to 23:00 GMT, the AUD declined 0.28% against the USD and closed at 0.7881.

LME Copper prices declined 0.9% or $66.0/MT to $7027.0/MT. Aluminium prices declined 1.2% or $27.0/MT to $2239.0/MT.

In the Asian session, at GMT0400, the pair is trading at 0.7859, with the AUD trading 0.28% lower against the USD from yesterday's close.

Overnight data revealed that Australia's Westpac leading index fell 0.24% on a monthly basis in January, compared to a revised gain of 0.21% in the previous month.

Moreover, the nation's seasonally adjusted construction work done retreated 19.4% on a quarterly basis in the three months to December 2017, more than market expectations for a drop of 10.0%. In the prior quarter, construction work done had climbed 15.7%.

The pair is expected to find support at 0.7831, and a fall through could take it to the next support level of 0.7802. The pair is expected to find its first resistance at 0.7911, and a rise through could take it to the next resistance level of 0.7962.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the EUR declined 0.4% against the USD and closed at 1.2335, after the Euro-zone's preliminary consumer confidence index slid more-than-anticipated to a level of 0.1 in February, dropping for the first time in seven months. The index had registered a level of 1.3 in the previous month, while investors had envisaged for a fall to a level of 1.0.

Additionally, the region's ZEW economic sentiment index dropped less-than-anticipated to a level of 29.3 in February, compared to a reading of 31.8 in the prior month, while markets were expecting for a fall to a level of 28.4.

Separately, economic sentiment in Germany deteriorated to a level of 17.8 in February, as continuous political uncertainty in the nation and turmoil in global equities dented investor confidence. Market participants had anticipated the index to fall to a level of 16.0, after registering a level of 20.4 in the previous month. Meanwhile, the nation's ZEW current situation index declined more-than-expected to a level of 92.3 in February, compared to market expectations for a drop to a level of 93.9. In the prior month, the index had registered a record high level of 95.2.

Other data showed that Germany's producer price index (PPI) rose 2.1% on an annual basis in January, higher than market expectations for a rise of 1.8%. However, this was the weakest growth since December 2016. In the previous month, the PPI had risen 2.3%.

In the Asian session, at GMT0400, the pair is trading at 1.2331, with the EUR trading slightly lower against the USD from yesterday's close.

The pair is expected to find support at 1.2302, and a fall through could take it to the next support level of 1.2272. The pair is expected to find its first resistance at 1.2379, and a rise through could take it to the next resistance level of 1.2426.

Trading trend in the Euro today is expected to be determined by the Markit manufacturing and services PMIs for February, slated to release across the Euro-zone in a few hours. Moreover, the US flash Markit manufacturing and services PMIs for February coupled with the nation's existing home sales data for January, all set to release later in the day, would keep investors on their toes.

The currency pair is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the GBP rose 0.16% against the USD and closed at 1.3995, lifted by renewed optimism over Brexit, following a report that the European Parliament is preparing a plan to give Britain “privileged” access to the single market.

In economic news, Britain's CBI industrial trends total orders fell more-than-expected to a level of 10.0 in February, against market expectations for a drop to a level of 11.0. The CBI industrial trends total orders had posted a reading of 14.0 in the previous month.

In the Asian session, at GMT0400, the pair is trading at 1.3989, with the GBP trading slightly lower against the USD from yesterday's close.

The pair is expected to find support at 1.3939, and a fall through could take it to the next support level of 1.3889. The pair is expected to find its first resistance at 1.4032, and a rise through could take it to the next resistance level of 1.4075.

Moving ahead, UK's ILO unemployment rate and average weekly earnings for the three months to December, slated to release in a few hours, will be on investors' radar.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD rose 0.53% against the JPY and closed at 107.31.

On the data front, Japan’s final machine tool orders recorded a rise of 48.8% on an annual basis in January, confirming the preliminary print. In the prior month, machine tool orders had recorded a rise of 48.3%.

In the Asian session, at GMT0400, the pair is trading at 107.81, with the USD trading 0.47% higher against the JPY from yesterday’s close.

The Japanese Yen lost ground against the USD, after overnight data showed that Japan’s flash Nikkei manufacturing PMI eased to a level of 54.0 in February, declining for the first time in 4 months. In the previous month, the PMI had recorded a level of 54.8.

Earlier in the session, data indicated that the nation’s all industry activity index rose 0.5% on a monthly basis in December, topping market expectations for a rise of 0.4%. In the previous month, the all industry activity index had advanced 1.0%.

The pair is expected to find support at 107.05, and a fall through could take it to the next support level of 106.30. The pair is expected to find its first resistance at 108.23, and a rise through could take it to the next resistance level of 108.66.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.