Sample Category Title

Daily Pivots: (S1) 121.04; (P) 122.08; (R1) 122.72; More...

Intraday bias in EUR/JPY remains neutral as the sideway consolidation from 124.08 extends. Deeper fall cannot be ruled out. On the downside, below 120.54 will target 118.45 cluster support (38.2% retracement of 109.20 to 124.08 at 118.39). In that case, we'd expect strong support from there to bring rebound. On the upside, break of 124.08 will extend the larger rally from 109.20 to 126.09 key resistance next.

In the bigger picture, price actions from 109.20 medium term bottom are seen as part of a medium term corrective pattern from 149.76. There is prospect of another rise towards 126.09 key resistance level before completion. But even in that case, we'd expect strong resistance between 126.09 and 141.04 to limit upside, at least on first attempt.

Subscribe to our daily and mid-day newsletter to get this report delivered to your mail box

This week was supposed to be dominated by central banks' decisions, earnings, and economic data from across the globe, but with Donald Trump in office, nothing seems capable of taking the spotlight from the White House.

U.S. stocks suffered their steepest declines so far this year with Dow Jones and S&P 500 both declining 0.6% on Tuesday. Meanwhile operating Asian markets are all in red led by Japanese stocks despite the BoJ upgrading growth estimates for the next two years and as expected keeping monetary policy unchanged.

Trump's executive order, signed on Friday banning Syrian refugees and suspending all nationals from seven countries doesn't by itself cause a major risk to financial markets. He already warned to ban Muslims, build a wall, cancel Obamacare, and tear up trade agreements. The President is just literally implementing his agenda and if we were not taking him seriously then it's our fault.

Whether you like President Trump or dislike him, as an investor you seek opportunities, and markets were rallying on the President's commitments to reduce taxes, deregulate businesses, and repatriate global assets. If these policies are at risk, this is when you should get worried.

Many Democrats intensified their attacks on Trump, meanwhile some Republicans are criticising the immigration order, and the firing of the acting attorney-general Sally Yates for opposing his travel ban is pouring fuel to the fire. The major risk looming now is the breakup of the Republican coalition, although this doesn't seem to be the case for the time being. I believe it's going to be the biggest risk to financial markets in the near future, as we end up with protectionist policies without the implementation of fiscal policies, thus triggering a sharp reversal in stocks worldwide.

Daily Pivots: (S1) 1.4096; (P) 1.4155; (R1) 1.4216; More...

EUR/AUD is staying in the sideway pattern from 1.4025 and intraday bias remains neutral. Price action from 1.4025 are seen as a corrective pattern and thus maintain near term bearishness. On the downside, break of 1.4025 will resume the larger fall from 1.6587 to key support level at 1.3671. We'd expect downside to be contained there to bring reversal. On the upside, above 1.4274 minor resistance will turn focus back to 1.4721 resistance.

In the bigger picture, price actions from 1.6587 medium term top are viewed as a consolidative pattern. 50% retracement of 1.1602 to 1.6587 at 1.4095 was already met. While further fall cannot be ruled out, we'd expect strong support above 1.3671 to contain downside and bring rebound. Up trend from 1.1602 should not be finished and will resume later. Break of 1.4721 resistance will be the first sign of resumption of up trend from 1.1602 and target retesting of 1.6587 high first.

Subscribe to our daily and mid-day newsletter to get this report delivered to your mail box

For the 24 hours to 23:00 GMT, the AUD rose 0.09% against the USD and closed at 0.7558.

LME Copper prices rose 0.2% or $10.0/MT to $5857.0/MT. Aluminium prices declined 1.1% or $20.5/MT to $1807.0/MT.

In the Asian session, at GMT0400, the pair is trading at 0.7564, with the AUD trading 0.08% higher against the USD from yesterday’s close.

Overnight data revealed that Australia’s NAB business confidence index advanced to a level of 6.00 in December, compared to a level of 5.0 in the previous month. Moreover, the nation’s NAB business conditions index climbed to a level of 11.0 in December, following a revised reading of 6.0 in the prior month.

The pair is expected to find support at 0.7534, and a fall through could take it to the next support level of 0.7505. The pair is expected to find its first resistance at 0.7582, and a rise through could take it to the next resistance level of 0.7601.

Looking ahead, traders would eye Australia’s AiG performance of manufacturing index for January, scheduled to release later tonight.

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

Daily Pivots: (S1) 1.0619; (P) 1.0659; (R1) 1.0682; More...

EUR/CHF's fall continues and intraday bias remains on the downside for 1.0620 support. Decisive break there will confirm resumption of whole fall from 1.1198. In that case, next downside target will be 1.0485 fibonacci level. On the upside, break of 1.0749 resistance is needed to indicate short term bottoming. Otherwise, outlook remain bearish in case of recovery.

In the bigger picture, the decline from 1.1198 is seen as a corrective move. Such correction is still in progress. Sustained trading below 38.2% retracement of 0.9771 to 1.1198 at 1.0653 will target 50% retracement at 1.0485. On the upside, break of 1.0897 resistance is needed to confirm completion of such fall. Otherwise, outlook will stay bearish.

Subscribe to our daily and mid-day newsletter to get this report delivered to your mail box

For the 24 hours to 23:00 GMT, the EUR declined 0.3% against the USD and closed at 1.0699.

Macroeconomic data indicated that Germany's preliminary consumer price index (CPI) jumped 1.9% on an annual basis in January, accelerating at its fastest pace in more than three-years, thus providing further evidence to the European Central Bank (ECB) that its loose monetary policy is working. The CPI recorded an advance of 1.7% in the previous month, while markets were expecting for a rise of 2.0%.

Additionally, the Euro-zone's final consumer confidence index was revised up to a level of -4.7 in January, compared to market consensus for the index to remain steady at a level of -4.9, recorded in the preliminary print. In the prior month, the index had registered a level of -5.1. Moreover, the region's economic sentiment indicator unexpectedly advanced to a level of 108.2 in January, hitting its highest level in six-years, highlighting that businesses and consumers across the Euro-bloc are growing confident about the region's growth prospects. In the preceding month, the index registered a reading of 107.8, while investors had envisaged for a steady reading. Also, the region's industrial confidence index increased to a level of 0.8 in January, notching its highest level since June 2011, compared to a revised flat reading in the prior month.

In the US, data revealed that pending home sales rebounded 1.6% MoM in December, surpassing market expectations for a rise of 1.0% and following a drop of 2.5% in the previous month. Further, the nation's personal spending climbed 0.5% in December, in line with market expectations and recording its biggest increase in three months. Personal spending registered a gain of 0.2% in the prior month. Meanwhile, the US personal income advanced less-than-expected by 0.3% in December, compared to a revised rise of 0.1% in the prior month, whereas markets were anticipating personal income to rise 0.4%. Moreover, the Dallas Fed manufacturing business index unexpectedly climbed to a level of 22.1 in January, compared to market expectations of a fall to a level of 15.0. In the previous month, the index had registered a revised reading of 17.7.

In the Asian session, at GMT0400, the pair is trading at 1.0697, with the EUR trading marginally lower against the USD from yesterday's close.

The pair is expected to find support at 1.0630, and a fall through could take it to the next support level of 1.0563. The pair is expected to find its first resistance at 1.0751, and a rise through could take it to the next resistance level of 1.0805.

Going ahead, market participants will keep a close watch on a speech by the ECB President Mario Draghi, along with a string of crucial economic releases in the Euro-zone, consisting of consumer price index for January, unemployment rate for January and 4Q GDP data, scheduled in a few hours. Also, Germany's retail sales for December and unemployment rate for January, will also pique significant amount of investor attention.

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

For the 24 hours to 23:00 GMT, the GBP declined 0.71% against the USD and closed at 1.2492.

In the Asian session, at GMT0400, the pair is trading at 1.2508, with the GBP trading 0.13% higher against the USD from yesterday's close.

Overnight data showed that UK's GfK consumer confidence unexpectedly improved to a level of -5.0 in January, compared to market expectations of a drop to -8.0 and following a level of -7.0 in the prior month. Also, the nation's Lloyds business barometer index eased to a level of 29.0 in January, compared to a level of 39.0 in the previous month.

The pair is expected to find support at 1.2450, and a fall through could take it to the next support level of 1.2392. The pair is expected to find its first resistance at 1.2578, and a rise through could take it to the next resistance level of 1.2648.

Moving ahead, UK's consumer credit and mortgage approvals data, both for December, scheduled to release in a few hours, will 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 USD declined 0.53% against the JPY and closed at 113.73.

In the Asian session, at GMT0400, the pair is trading at 113.52, with the USD trading 0.18% lower from yesterday's close.

The Japanese Yen gained ground against the USD, after the Bank of Japan (BoJ), in its latest monetary policy meeting, raised Japan's growth forecast for 2017 and 2018.

Earlier today, the BoJ held the benchmark interest rate steady at -0.1%, as widely anticipated. The central bank also pledged to continue with its yield curve control programme for “as long as it is necessary” to achieve its inflation target of 2.0% in a stable manner. Further, policymakers also boosted their growth-outlook for fiscal year 2016 to 1.4% from a prior estimate of 1.0% made in October, while fiscal 2017 growth was also upwardly revised to 1.5% from 1.3% in October. For fiscal 2018, it raised its forecast to 1.1%, from 0.9%. However, the central bank left its forecasts for core consumer price inflation unchanged.

In other economic news, data showed that Japan's unemployment rate remained steady at 3.1% in December, meeting market expectations. Additionally, the nation's preliminary industrial production advanced 0.5% on a monthly basis in December, more than market expectations for an advance of 0.3% and following a rise of 1.5% in the prior month. On the other hand, the nation's small business confidence eased to a level of 48.3 in January, from a level of 48.8 in the previous month.

The pair is expected to find support at 112.84, and a fall through could take it to the next support level of 112.17. The pair is expected to find its first resistance at 114.56, and a rise through could take it to the next resistance level of 115.61.

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

For the 24 hours to 23:00 GMT, the USD declined 0.18% against the CHF and closed at 0.9948.

On the data front, Switzerland’s KOF economic barometer unexpectedly dropped to a level of 101.7 in January, defying market expectations for a rise to a level of 102.9 and compared to a revised level of 102.1 in the prior month. Also, the nation’s total sight deposits inched up to a level of CHF532.8 billion in the week ended 27 January, from CHF532.3 billion in the previous week.

In the Asian session, at GMT0400, the pair is trading at 0.9948, with the USD trading flat against the CHF from yesterday’s close.

The pair is expected to find support at 0.9903, and a fall through could take it to the next support level of 0.9859. The pair is expected to find its first resistance at 1.0018, and a rise through could take it to the next resistance level of 1.0089.

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

For the 24 hours to 23:00 GMT, the USD declined 0.1% against the CAD and closed at 1.3112.

In the Asian session, at GMT0400, the pair is trading at 1.3094, with the USD trading 0.14% lower against the CAD from yesterday's close.

The pair is expected to find support at 1.3056, and a fall through could take it to the next support level of 1.3017. The pair is expected to find its first resistance at 1.3151, and a rise through could take it to the next resistance level of 1.3207.

Ahead in the day, Canada's GDP for December and RBC manufacturing PMI for January, will be on investor's radar.

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