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Even though the yellow metal managed to shoot up during the first half of Tuesday, the combined resistance of the 55-hour SMA, the weekly PP and the bottom boundary of the breached two-month channel up proved to be an unbreakable barrier which sent the pair down to 1,336.80. The rate has since returned back to the 55-hour SMA which is now likewise reinforced by the 200-hour SMA. The pair should edge slightly higher in this session towards the prevailing short-term channel down circa 1,345.00. The upside target in this case could be the weekly PP and the 100-hour SMA near 1,348.30. By and large, several noteworthy fundamentals which could shake the market are to be released today. In case of a negative surprise, Gold should be supported by the weekly S1 and the monthly R2 at 1,329.00.

USD/JPY has remained steady for the last three trading sessions. The main reason has been the pair’s inability to breach the strong support of the 55– and 100-hour SMAs that were located slightly below 109.00 at the time of the analysis. The overall trend, however, has been slightly upwards, as shows by the dashed line. Given that the Greenback still remains weak against the Yen, bulls might fail to breach the 109.00 area, at least during the first part of the day. This situation could change later in the session when several noteworthy fundamentals are released. A positive outcome should not exceed the 200-hour SMA at 109.67, while the opposite scenario might bring further decline for the US Dollar down to the 108.00 mark or the distant weekly S1 at 107.53.

Upside risks prevailed in the market on Tuesday, thus allowing GBP/USD to end the session with a 74-pip advance. The pair experienced a brief period of consolidation after breaching the 55-hour SMA and the weekly PP, but eventually managed to dash through the 100-hour moving average, as well. In accordance with technical indicators, there is still some upside potential that could push the rate towards the 1.4250 mark where the bottom boundary of the breached four-week channel is located. However, their high positioning suggests that this expected movement up is unlikely to be sustainable for the whole session. Meanwhile, the southern barrier is guarded by several noteworthy support levels. In case no fundamentals breach this area, the Pound should remain trading near 1.4150 by Wednesday morning.

EUR/USD spent the Tuesday morning in between the bounds of the 100– and 200-hour SMAs. A subsequent surge apparent mid-session allowed for a breakout of the former, the 55-hour moving average, the weekly PP and the monthly S2 in the 1.2400/45 area. At that point, the Euro lost its upside momentum and thus remained fluctuating within this territory. This trading day might mark another surge, as shown by technical indicators. This scenario is rather realistic, considering that the southern side is now protected by several notable barriers; meanwhile, the nearest resistance is formed by the distant weekly R1 at 1.2575. On the other hand, the pair has lost momentum up near the monthly S2. This factor might likewise be an early indication of a fall that should halt at the 200-hour SMA circa 1.2340.

The Aussie fell against the US Dollar in a wake of the quarterly report on Australia’s consumer price data. The AUD/USD exchange rate slipped 0.34% or 27 base points to the 0.8073 mark.

Australian consumer inflation remained subdued in the December quarter, as the core CPI annual growth was below the Bank’s target for the second year in a row, fuelling investors’ expectations for a rate hike anytime soon. The Australian Bureau of Statistics reported that the country’s CPI grew 0.6% in the Q4, while annual growth pace was registered at 1.9%. Higher prices of petrol, tobacco and fruit contributed most to expansion, while the main headwind was pay growth, which weakened to historical lows even with a strong employment.

The USD/JPY currency pair ignored stronger-than-anticipated CB consumer confidence report. The Greenback fell slightly against the Yen, but continued trading session higher, in the 108.75 area.

The US consumer confidence strengthened over the course of January, while house prices rose further in November, indicating that a recent consumer spending acceleration was set to be steady despite a sluggish pay growth. The Conference Board stated that the consumer confidence index rose to 125.4 in January, suggesting stronger spending in the beginning of the year. However, consumers were less optimistic in the current conditions’ evaluation, while being more ambivalent concerning income prospects.

The EZ flash GDP data release was not a trend changer in the EUR/USD currency pair. The Euro kept strengthening against the Greenback to touch the intraday high of 1.2450.

The Euro zone economy marked the fastest growth pace in a decade last year, preliminary report revealed, with sentiment remaining at the strong level, suggesting a solid start entering 2018. Eurostat stated that estimated growth domestic product in the bloc marked a 0.6% quarterly increase in three months to December 2017, which put yearly growth to 2.7% in the same period. Investment is expected to recover fully from post-crisis lows, to continue providing essential contribution to expansion over the coming year.

EUR/CAD has been trading in an ascending channel since early January. The currency exchange rate has formed a new high during this period.

The bull movement was temporarily stopped by the weekly R1 at 1.5417 and retraces south for a brief period of time. The pair is likely to breach the dotted line and move further south.

Regarding the short-term, the pair might find support at the weekly S1 1.5203 combined with the 100—hour simple moving average. If looking at the Fibonacci retracement level, the pair is likely to move further south until it reaches the 50.00% level. This retracement can be measured with the low at 1.4819 and the high at 1.5417.

The common European currency continued to appreciate against the New Zealand Dollar after hitting the dominant support line near the 1.6520 level in early January.

After reaching the 50.00% Fibonacci retracement level, the pair started making a U-turn to the south. The retracement can be measured by connecting the January low at 1.6520 and the December high at 1.7480.

Meanwhile, in the 1H time frame there is already a breakout from a rectangle pattern, which can be observed on the chart. The currency exchange rate is likely to continue south until it finds support at the weekly pivot point level at 1.6690.

The Australian dollar rose in Asia on Wednesday despite downbeat Australian data released earlier (Q4 CPI fell below expectations (0.6% vs 0.7% f/c) and weaker than expected China’s Jan Manufacturing PMI (51.3 vs 51.5 f/c and 51.6 previous).

The Aussie was inflated by weaker US dollar, which fell after President Trump’s State of the Union speech, maintaining fragile sentiment ahead of key event, release of US monetary policy decision.

The pair maintains overall bullish tone as shallow corrective attempts were contained by rising 10SMA (currently at 0.8046), above which repeated strong downside rejections occurred (Tuesday / today).

Immediate bulls are expected to keep above 10 SMA and keep the structure intact for fresh attempts at 0.8135 (26 Jan peak, the highest since May 2015) and final push towards target at 0.8164 (14 May 2015 high / 50% retracement of 0.9503/0.6826 fall).

However, negative scenario on break below 10SMA and extension of pullback from 0.8135 cannot be ruled out as bearish divergence on overbought daily RSI warns of deeper correction.

Res: 0.8118, 0.8135, 0.8164, 0.8200
Sup: 0.8046, 0.8000, 0.7969, 0.7896