Sample Category Title

For the 24 hours to 23:00 GMT, the USD declined 0.18% against the JPY and closed at 111.29.

In the Asian session, at GMT0400, the pair is trading at 111.36, with the USD trading 0.06% higher against the USD from yesterday’s close.

The pair is expected to find support at 110.80, and a fall through could take it to the next support level of 110.25. The pair is expected to find its first resistance at 111.82, and a rise through could take it to the next resistance level of 112.29.

Moving ahead, all eyes will be on the release of Japan’s preliminary Nikkei manufacturing PMI for March, slated to release overnight.

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 USD declined 0.14% against the CHF and closed at 0.9917.

In the Asian session, at GMT0400, the pair is trading at 0.9926, with the USD trading 0.09% higher against the CHF from yesterday’s close.

The pair is expected to find support at 0.9888, and a fall through could take it to the next support level of 0.9851. The pair is expected to find its first resistance at 0.9954, and a rise through could take it to the next resistance level of 0.9983.

With no major economic releases in Switzerland today, investor sentiment will be governed by global macroeconomic factors.

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

GBP/USD - 1.2491

Most recent candlesticks pattern   : N/A

Trend                                 : Near term up

Tenkan-Sen level                 : 1.2493

Kijun-Sen level                    : 1.2471

Ichimoku cloud top              : 1.2446

Ichimoku cloud bottom        : 1.2415

Original strategy :

Buy at 1.2355, Target: 1.2500, Stop: 1.2320

Position : -

Target :  -

Stop : -

New strategy  :

Buy at 1.2400, Target: 1.2520, Stop: 1.2365

Position : -

Target :  -

Stop : -

As cable has continued trading with a firm undertone, adding credence to our bullish view that recent upmove from 1.2109 is still in progress and may extend further gain to 1.2540-50 but loss of upward momentum would limit upside to previous chart resistance at 1.2570 and price should falter below 1.2600-10, risk from there has increased for a retreat to take place later.

In view of this, would not chase this move here and we are looking to buy cable on subsequent pullback as 1.2400 should limit downside. Below 1.2380-85 would defer and risk correction to 1.2350-55 but still reckon support at 1.2335 would remain intact, bring another rise later. 

EUR/USD - 1.0799

Most recent candlesticks pattern   : N/A

Trend                      : Near term up

Tenkan-Sen level              : 1.0793

Kijun-Sen level                  : 1.0800

Ichimoku cloud top             : 1.0795

Ichimoku cloud bottom      : 1.0769

Original strategy  :

Buy at 1.0725, Target: 1.0840, Stop: 1.0690

Position : -

Target :  -

Stop : -

New strategy  :

Buy at 1.0725, Target: 1.0840, Stop: 1.0690

Position : -

Target :  -

Stop : -

As the single currency retreated after rising to 1.0825 yesterday, suggesting minor consolidation below this level would be seen and pullback to 1.0750-60 cannot be ruled out, however, reckon support at 1.0719 would limit downside and bring another rise later, above indicated resistance at 1.0825-29 would extend further rise to 1.0850-60 but loss of near term upward momentum should prevent sharp move beyond 1.0880 and price should falter below 1.0900, risk from there has increased for a retreat to take place later.

In view of this, would not chase this rise here and we are looking to buy euro on subsequent pullback as 1.0719 support should limit downside and bring another rise later. Below 1.0690-00 would defer and suggest top is possibly formed, risk weakness to 1.0640 (previous resistance now support) but still reckon indicated support at 1.0600 would remain intact.

For the 24 hours to 23:00 GMT, the USD declined 0.16% against the CAD and closed at 1.3331.

In the Asian session, at GMT0400, the pair is trading at 1.3321, with the USD trading 0.08% lower against the USD from yesterday’s close.

The pair is expected to find support at 1.3290, and a fall through could take it to the next support level of 1.3259. The pair is expected to find its first resistance at 1.3380, and a rise through could take it to the next resistance level of 1.3439.

Amid a lack of economic releases in Canada today, trading trends in the CAD are expected to be determined by global macroeconomic events.

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

USD/JPY - 111.15

Most recent candlesticks pattern   : N/A

Trend                      : Near term down

Tenkan-Sen level              : 111.36

Kijun-Sen level                  : 111.19

Ichimoku cloud top             : 112.17

Ichimoku cloud bottom      : 111.88

Original strategy  :

Sell at 112.00, Target: 110.80, Stop: 112.35

Position :  -

Target :  -

Stop : -

New strategy  :

Sell at 112.00, Target: 110.80, Stop: 112.35

Position :  -

Target :  -

Stop : -

As the greenback recovered after falling to 110.73, suggesting consolidation above this level would be seen and corrective bounce to 111.55-60 is likely, however, still reckon upside would be limited to 112.00-10 and bring another decline later, a break of said support at 110.73 would signal recent decline is still in progress and may extend further fall to 110.50 but near term oversold condition should prevent sharp fall below 110.20-25 and reckon 110.00 would hold from here. 

In view of this, would not chase this fall here and would be prudent to sell cable on recovery as 112.00 should limit upside. Only above indicated previous support at 112.26 would abort and signal low is formed instead, bring a stronger rebound to 112,59 but resistance at 112,87-90 should cap upside.

RBNZ holds rates as expected and maintains neutral policy stance

Asia Mid-Session Market Update: RBNZ holds rates as expected and maintains neutral policy stance; US GOP lawmakers continue to negotiate healthcare bill ahead of Thursday vote

US Session Highlights

(EU) ECB's Villeroy: Recovery in inflation did not yet warrant a change in current accommodative policy

(US) MBA MORTGAGE APPLICATIONS W/E MAR 17TH: -2.7% V 3.1% PRIOR

(US) JAN FHFA HOUSE PRICE INDEX M/M: 0.0% V 0.4%E

(US) FEB EXISTING HOME SALES: 5.48M V 5.55ME

(US) SEC votes unanimously to approve rules to shorten standard securities settlement time to two days from three days

(US) DOE CRUDE: +5.0M V +2ME; GASOLINE: -2.8M V -2ME; DISTILLATE: -1.9M V -1.5ME

(UK) Metropolitan Polices Dep Commissioner: London attack "inspired by international Islamist terrorism" results in 5 deaths and 40 injured - press

US markets on close: Dow flat, S&P500 +0.2%, Nasdaq +0.5%

Best Sector in S&P500: Technology

Worst Sector in S&P500: Telecom

Biggest gainers: MAR +3.4%, VTR +2.8%, FMC +2.7%, ILMN +2.6%, UAL +2.6%

Biggest losers: FTR -10.6%, NKE -7.1%, TDG -4.4%, MNK -3.4%, LB -2.7%

At the close: VIX 12.8 (+0.3 pts); Treasuries: 2-yr 1.26% (flat), 10-yr 2.40% (-4bps), 30-yr 3.01% (-4bps)

US movers afterhours

HTGM: Obtains CE Mark for its HTG EdgeSeq ALKPlus Assay EU; +69.6% afterhours

FIVE: Reports Q4 $0.90 v $0.89e, R$388.1M v $387Me; Guides Q1 $0.12-0.14 (GAAP) v $0.14e, R$228-232M v $229Me, SSS flat to +2%; +8.2% afterhours

PVH: Reports Q4 $1.23 v $1.21e, R$2.11B v $2.09Be; Increases share buyback by $750M extended to Jun 2020 (10.4% of market cap); Guides Q1 $1.58-1.60 v $1.57e; +7.2% afterhours

BEBE: Confirms exploring strategic alternatives; +6.5% afterhours

MLHR: Reports Q3 $0.37 v $0.33e, R$524.9M v $531Me (2 est); +5.1% afterhours

CPB: Announces $1.5B share repurchase program (9% of market cap); +1.6% afterhours

RARE: Phase 2 UX007 Glucose Transporter Type-1 Deficiency Syndrome Seizure Study: Overall seizures not significantly reduced; decrease in absence seizures observed; -6.6% afterhours

Politics

(US) FBI said to have information that associates of Pres Trump communicated with Russian operatives during elections and may have released information damaging to Clinton campaign - CNN

(US) Trump administration reportedly considering making last minute changes to House healthcare bill to appease Freedom Caucus - Axios

Asia Key economic data:

(NZ) NEW ZEALAND CENTRAL BANK (RBNZ) LEAVES OFFICIAL CASH RATE (OCR) UNCHANGED AT 1.75%; AS EXPECTED

(HK) Macau Feb Visitor Arrivals -13.2% m/m, -5.6% y/y to 2.50M

Asia Session Notable Observations, Speakers and Press

Asian equities have come off overnight lows as the selling in US stocks subsided, however the focus for sentiment remains primarily on the fate of the US healthcare legislation in the House vote on Thursday evening. Despite reports of limited progress made in swaying the members of a more conservative Freedom Focus during US hours, the administration claims it will proceed with the vote. In late US hours on Wednesday, press reports suggest that the White House is considering last-minute concessions to the right wing of the party, namely reducing some of the "essential benefit" requirements of Obamacare, though it is unclear whether that would dissuade some of the more moderate lawmakers from supporting the bill.

In FX, USD majors traded rangebound as selling in the greenback subsided during US hours. USD/JPY rose nearly 80pips from US session lows to 111.50, while EUR/USD spent much of the day in 1.0780-0820 range. GBP/USD was volatile in early US hours amid reports of a terror attack in London that claimed the lives of 5 people, falling to low 1.2420s before returning toward 1.25 handle. NZD/USD hit session high just shy of 0.7070 in the wake of RBNZ policy statement that expressed more concern over housing inflation while reiterating that exchange rate should depreciate more to achieve balanced growth. RBNZ's tempered view of progress in housing as attributed to macroprudential measures risks a rush to tighten late this year, and indeed the OIS swaps market saw Q1 2018 odds of a hike inch up 4pts to near 50%. However, RBNZ also expressed awareness of "surplus capacity in the global economy and extensive geo-political uncertainty", giving markets little reason to anticipate a shift from policy status quo.

China

(CN) China plans to hold a meeting of BRICS economy and trade ministers in July - press

(CN) China Commerce Ministry (MOFCOM): Working with Saudi Arabia to push ahead energy cooperation - press

(CN) Some China coal-fired plants urge coal price cut - Chinese press

Australia/New Zealand

(AU) Australia PM Turnbull: China and Australia are reaping the benefits of free trade agreement - press

(NZ) Rabobank: New Zealand pessimism about rural economy has fallen to a 3-year low - press

Korea

(KR) US govt reportedly readying cases that link North Korea to cybertheft at the NY Fed - press

Asian Equity Indices/Futures (00:00ET)

Nikkei flat, Hang Seng +0.4%, Shanghai Composite +0.3%, ASX200 +0.3%, Kospi +0.2%

Equity Futures: S&P500 +0.2%; Nasdaq +0.1%; Dax +0.2%; FTSE100 +0.1%

FX ranges/Commodities/Fixed Income (00:00ET)

EUR 1.0780-1.0800; JPY 111.10-111.60; AUD 0.7650-0.7680; NZD 0.7025-0.7050

Apr Gold -0.3% at $1,246/oz; May Crude Oil +0.7% at $48.39/brl; May Copper flat at $2.64/lb

(CN) PBOC SETS YUAN MID POINT AT 6.8856 V 6.8889 PRIOR; 2nd straight firmer setting

(CN) PBOC to inject combined CNY30B v CNY90B prior in 7,14, and 28-day reverse repos

Asia equities/Notables/movers by sector

Consumer discretionary: 2331.HK Li Ning Co -3.3% (annual result); 288.HK WH Group +8.6% (annual result)

Financials: 416.HK Bank of Jinzhou -0.3% (annual result); 998.HK China CITIC Bank -0.4% (annual result); 2318.HK Ping An Insurance +2.3%, 1113.HK Cheung Kong Property Holdings +1.8%, 1.HK CK Hutchison Holdings +0.6% (annual result)

Industrials: 631.HK Sany Heavy Equipment International Holdings -1.2%, 175.HK Geely Automobile Holdings -2.0% (FY16 result); FBU.NZ Fletcher Building Limited -2.3% (new CEO); 5631.JP Japan Steel Works -2.4% (cuts guidance)

Technology: 700.HK Tencent Holdings -1.0% (Q4 result); 763.HK ZTE Corp +2.3% (settlement); 1169.HK Haier Electronics Group +12.3% (annual result); ISD.AU iSentia Group -2.0% (CFO resigns)

Materials: 743.HK Asia Cement China Holdings -0.8% (annual result)

Energy: 1898.HK China Coal Energy -2.0%; 2208.HK Xinjiang Goldwind Science & Technology +0.8% (annual result)

Healthcare: SIP.AU Sigma Pharmaceuticals +2.3% (FY17 result)

Utilities: AST.AU AusNet Services -0.9% (Citi cuts rating)

Short term Elliott Wave view in USDJPY suggests that rally to 115.48 on 3/10 ended Intermediate wave (X). Decline from there is unfolding as a zigzag Elliott wave structure in which the first leg Minor wave A is subdivided in 5 impulsive waves. Down from 3/10 high, Minute wave ((i)) ended at 114.46, Minute wave ((ii)) ended at 115.195, Minute wave ((iii)) ended at 110.71 and Minute wave ((iv)) is proposed complete at 111.59. Cycle from 3/10 high is mature and Minor wave A has enough extension to be called complete, but a marginal low towards 100 – 110.5 area can’t be ruled out to complete Minor wave A. Afterwards, pair should bounce in Minor wave B in 3, 7, or 11 swing to correct cycle from 3/10 high before the decline resumes. We do not like buying the proposed bounce in Minor wave B and expect sellers to appear when Minor wave B bounce is over in 3, 7, or 11 swing later for another extension lower.

USDJPY 1 Hour Chart

Key Points:

• Double bottom structure seems to be forming.
• Ascending trend line should now come into play.
• US Inventories build has likely delayed the rally.

Oil prices look to have finally found a bottom, potentially even two of them, which could see buying pressure mount in the coming sessions. Additionally, a number of other technical instruments are signalling that a reversal is on the way which comes as little surprise given the presence of the ascending trend line.

First and foremost, as mentioned above, there seems to be a double bottom forming up on the daily chart which indicates selling pressure may be running thin. To some extent, this will a result of oil moving into oversold territory as is made clear by the stochastic oscillator. However, the impending MACD signal line crossover is also suggestive of a near-term change in momentum.

Aside from these near-term technical readings, the long-term trend line provides what is probably the strongest argument for a reversal. As is shown above, the commodity is drawing fairly close to the ascending line which will certainly have the bears worried. Indeed, their inability to push substantially below this level is evident in the long shadows of the two candles that form the troughs of the depicted double bottom structure.

Although, given the shift in the EMA bias to bearish, gains could be fairly muted for oil which might mean we instead see it drift lazily higher rather than reversing sharply as forecasted. The main counter argument to this would be the mere fact that the commodity is now below the $50 handle, a handle that has only recently been priced in as the medium to long-term average. However, the neckline of the double bottom is also relatively shallow which makes it a fairly achievable zone to break through, meaning, sparking a rally typical of the double bottom pattern will be relatively easy.

Once an upswing has taken hold, we expect gains to extend to, at most, the 51.55 handle. This price is somewhat shy of what would generally be forecasted for a chart pattern such as this, however, there is some reason to doubt the overall strength of the rally. Firstly, the 100 day moving average is likely to be a source of dynamic resistance which will begin to cap upsides around the 50.70 mark. This being said, the real challenge will be in overcoming the 50.0% Fibonacci level around the 51.55 level as it also coincides with a number of historical reversal points.

Ultimately, yesterday’s 4.95M build in US Crude Oil Inventories could delay the forecasted uptrend for a few sessions. Although, the fact that such a build barely managed to push the commodity lower could also be taken as a sign that it is ready to surge higher when fundamentals stop weighing it down. However, also stay on the lookout for any developments from OPEC as the cartel is likely to have something in the wings to re-float oil prices going forward which would suit this technical forecast just fine.

Global Markets:

• Asian stock markets: Nikkei up 0.10 %, Shanghai Composite gained 0.30 %, Hang Seng and ASX 200 both rose 0.35 %
• Commodities: Gold at $1246 (-0.30 %), Silver at $17.55 (-0.20 %), WTI Oil at $48.40 (+0.75 %), Brent Oil at $51.00 (+0.70 %)
• Rates: US 10 year yield at 2.41, UK 10 year yield at 1.18, German 10 year yield at 0.41

News & Data:

• RBNZ Interest Rate Remains Unchanged At 1.75%, As Expected
• PBoC Fixes USDCNY Reference Rate At 6.8856 (Prev 6.8889)
• Asia stocks rise, but gains for dollar, oil capped by jitters – RTRS
• Slide in U.S. infrastructure stocks sign of 'Trump trade' weakness – RTRS
• Dollar limps up from four-month low vs. yen, Trump's healthcare bill in focus – RTRS

Markets Update:

Stock markets have calmed down following the sharp sell-off on Tuesday. Most of the major Asian indices are up on the day, but investors remain cautious overall.

Meanwhile, the US Dollar remains under pressure. EUR/USD failed to sustain momentum above 1.08, but is still bid. Resistance is seen in the area between 1.0820 and 1.0830. Should the pair break above it, it will likely extend the rally further beyond 1.09.

GBP/USD declined yesterday on the news that there has been a terrorist attack in London. However, it recovered later and rose back to 1.25. Overall, the short-term outlook is positive from a technical perspective. After 1.25, the next strong resistance level lies at 1.2580.

USD/JPY is looking a bit oversold on the hourly charts, and could see a bounce in the next few sessions. Nevertheless, the outlook remains negative and there will be good selling interest on any larger rally. Strong resistance is noted in the area between 112.00 and 112.25.

Upcoming Events:

• 09:00 GMT – ECB Economic Bulletin
• 09:30 GMT – UK Retail Sales
• 12:30 GMT – US Initial Jobless Claims
• 11:00 GMT – Fed Chair Yellen speaks
• 14:00 GMT – US New Home Sales
• 21:45 GMT – New Zealand Trade Balance