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Daily Pivots: (S1) 1.0557; (P) 1.0598 (R1) 1.0622; More.....

Despite prior brief breach of 1.0630 minor resistance, EUR/USD is staying in established range of 1.0493/1.0630. Intraday bias remains neutral at this point. On the upside, firm break of 1.0630 resistance will argue that pull back from 1.0828 is completed. Also, rise from 1.0339 could possibly be resuming. In that case, intraday bias will be turned back to the upside for 1.0828 resistance and above. On the downside, below 1.0493 support will affirm the case that fall from 1.0828 is resuming the larger down trend. In that case, intraday bias will be back to the downside for resting 1.0339 low.

In the bigger picture, whole down trend from 1.6039 (2008 high) is in progress. Such down trend is expected to extend to 61.8% projection of 1.3993 to 1.0461 from 1.1298 at 0.9115. On the upside, break of 1.1298 resistance is needed to confirm medium term bottoming. Otherwise, outlook will stay bearish in case of rebound.

Market movers today

It is another quiet day in terms of global data releases ahead of the ECB meeting on Thursday and the US jobs report on Friday.

We have some important data releases in the Scandis today, not least in Norway. Norges Bank will publish the regional survey, which is its preferred economic indicator. We estimate the index climbed to around 1.0 in February, equivalent to roughly 2.0% annualised growth. Also, manufacturing production data for January is due out.

In Sweden, the budget balance data for February is due out.

For more details on the Scandi releases, see page 2.

Selected market news

Markets are relatively calm this morning. In the US, S&P 500 closed a bit lower yesterday and futures point at further losses today, as investors may have taken profits from the strong gains recently amid the more hawkish Fed strongly indicating a hike next week. EUR/USD is unchanged, just below 1.06. Brent oil trades at USD56 per barrel amid Iraq comments that it is ready to cut oil production further if the OPEC decides to extend its current cut policy, according to Bloomberg. As expected, the Reserve Bank of Australia kept its policy unchanged at 1.50%.

Yesterday, we published our ECB Preview: Inflation on target but still too early to discuss tapering. We expect the ECB to maintain its dovish stance at the meeting on Thursday, although inflation has reached the 2% target, as we expect core inflation will have to exceed 1.0% for a number of months before the ECB will announce tapering of its QE purchases. We still believe the ECB will extend its QE programme beyond December 2017. The ECB released QE details yesterday, see more here.

In the US, Trump has signed a new executive order banning immigration from six Muslim countries ('travel ban 2.0'), effective from 16 March. The new travel ban tries to address some of the problematic issues raised by federal courts. Still, the travel ban is likely to face legal challenges and is likely to be centre of attention in the media coverage in coming days/weeks. For more read CNN.

In France, presidential candidate Francois Fillon got support from the leadership of the Republican party. Yesterday, Alain Juppé (runner up in the primary) said he will not run; therefore, the Republican party did not have any other choice but to back Fillon. Fillon's campaign has suffered heavily from accusations that he paid his wife a salary for a 'fake job' and he is now third in the poll, meaning he is not expected to go through to the second round. The first round of the presidential election will be held on 23 April. For economic and financial implications of a Marine Le Pen win see Le Pen - What If? Implications for Euro and Nordic markets, 23 February 2017.

We expect the US jobs report, due out on Friday, to be strong enough for the Fed to hike next week. See our jobs report preview, US Labour Market Monitor: Jobs report should be more than strong enough for the Fed to hike later this month, 7 March 2017.

Daily Pivots: (S1) 1.2207; (P) 1.2254; (R1) 1.2284; More...

GBP/USD's consolidation from 1.2213 temporary low continues today and intraday bias remains neutral first. While another recovery cannot be ruled out, we'd expect upside to be limited by 1.2382 support turned resistance to bring another fall. As noted before, consolidation pattern from 1.1946 should have completed with three waves to 1.2705 already. Below 1.2213 will turn bias to the downside for retesting 1.1946/86 support zone. Break of 1.1946 will confirm our bearish view and resume the larger down trend. Nonetheless, on the upside, above 1.2382 minor resistance will delay the bearish case and turn bias back to the upside for 1.2569.

In the bigger picture, fall from 1.7190 is seen as part of the down trend from 2.1161. There is no sign of medium term bottoming yet. Sustained trading below 61.8% projection of 2.1161 to 1.3503 from 1.7190 at 1.2457 will target 100% projection at 0.9532. Overall, break of 1.3444 resistance is needed to confirm medium term bottoming. Otherwise, outlook will remain bearish.

Daily Pivots: (S1) 1.0084; (P) 1.0107; (R1) 1.0141; More.....

USD/CHF's consolidation from 1.0145 temporary top continues today and intraday bias remains neutral at this point. As long as 1.008 minor support holds, further rise would be mildly in favor. Break of 1.0145 will extend the whole rebound from 0.9860 and target test on 1.0342 key resistance. Based on neutral medium term outlook, we'd be cautious on topping at around 1.0342. On the downside, break of 1.0008, however, will indicate completion of the rebound from 0.9860. And intraday bias will be turned back to the downside for 0.9860.

In the bigger picture, prior rejection from 1.0327 resistance argues that USD/CHF is staying in a medium term sideway pattern. In any case, decisive break of 1.0342 resistance is needed to confirm underlying strength. Otherwise, we'll stay neutral in the pair first. In case of another fall, we'd expect strong support from 0.9443/9548 support zone. Meanwhile firm break of 1.0342 will target 38.2% retracement of 1.8305 to 0.7065 at 1.1359.

Daily Pivots: (S1) 113.58; (P) 113.85; (R1) 114.16; More...

Intraday bias in USD/JPY remains neutral for the moment as the pair is staying in tight range below 114.94 resistance and above 4 hour 55 EMA. Near term outlook is a bit mixed as the corrective fall from 118.65 might not be completed yet. But still, in case of another fall, we'd still expect strong support from 38.2% retracement of 98.97 to 118.65 at 111.13 to contain downside and bring rebound. On the upside, decisive break of 114.94 will indicate that it's completed with a double bottom pattern (111.58, 111.68). In such case, intraday bias will be turned to the upside for retesting 118.65.

In the bigger picture, price actions from 125.85 high are seen as a corrective pattern. The impulsive structure of the rise from 98.97 suggests that the correction is completed and larger up trend is resuming. Decisive break of 125.85 will confirm and target 61.8% projection of 75.56 to 125.85 from 98.97 at 130.04 and then 135.20 long term resistance. Rejection from 125.85 and below will extend the consolidation with another falling leg before up trend resumption.

Daily Pivots: (S1) 1.3350; (P) 1.3393; (R1) 1.3416; More...

USD/CAD is staying in consolidation below 1.3436 temporary top and intraday bias remains neutral first. While deeper retreat cannot be ruled out, downside should be contained well above 1.3209 resistance turned support and bring another rally. Above 1.3436 will extend the whole rise from 1.2968 and target 1.3598 high. Break there will resume the medium term rally from 1.2460 to next fibonacci level at 1.3838.

In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. The first leg has completed at 1.2460. The second leg is likely still in progress and could target 61.8% retracement of 1.4689 to 1.2460 at 1.3838. We'd look for reversal signal there to start the third leg. Break of 1.2968 wold at least bring at retest of 1.2460 low. However, sustained trading above 1.3838 would pave the way to retest 1.4689 high.

USD/CHF - 1.0116

Most recent candlesticks pattern : N/A

Trend                                    : Sideways

Tenkan-Sen level                  : 1.0117

Kijun-Sen level                    : 1.0102

Ichimoku cloud top                 : 1.0110

Ichimoku cloud bottom              : 1.0096

New strategy  :

Stand aside

Position : -

Target :  -

Stop : -

Although the greenback found support at 1.0073 yesterday and rebounded since, dollar needs to penetrate resistance at 1.0146 to signal recent erratic rise has resumed and extend further gain to 1.0170-80, however, loss of upward momentum should prevent sharp move beyond 1.0200, risk from there remains for another retreat later.

In view of this, would not chase this rise here and would be prudent to stand aside in the meantime. Below said support at 1.0073 would bring weakness to 1.0060-65 (61.8% Fibonacci retracement of 1.0009-1.0146 and previous support), however, as broad outlook remains consolidative, reckon downside would be limited to 1.0035-40 and price should stay well above support at 1.0009, bring rebound later.

For the 24 hours to 23:00 GMT, the AUD declined 0.13% against the USD and closed at 0.7583.

Yesterday, data showed that Australia's AiG performance of construction index rose to a level of 53.1 in February, from a reading of 47.7 in the previous month.

LME Copper prices declined 0.9% or $54.0/MT to $5856.0/MT. Aluminium prices declined 2.2% or $41.0/MT to $1868.0/MT.

In the Asian session, at GMT0400, the pair is trading at 0.7603, with the AUD trading 0.26% higher against the USD from yesterday's close.

Earlier today, the Reserve Bank of Australia (RBA), in a widely expected move, maintained the official cash rate steady at a record low level of 1.5% for a sixth straight meeting. The RBA Governor, Philip Lowe stated that global economic conditions have improved over recent months and that the Australian economy continues to transition after the mining boom. He further added that while the nation's headline inflation is expected to pick up over the course of 2017, there remains considerable variation across the nation's jobs and housing markets.

The pair is expected to find support at 0.7571, and a fall through could take it to the next support level of 0.7540. The pair is expected to find its first resistance at 0.7630, and a rise through could take it to the next resistance level of 0.7658.

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

Daily Pivots: (S1) 0.7563; (P) 0.7586; (R1) 0.7602; More...

AUD/USD recovers further today but stays below 0.7635 minor resistance. Outlook is unchanged so far. Deeper fall is still in favor as long as 0.7635 minor resistance holds. We're holding on to the view that rebound from 0.7158 is finished at 0.7740. Below 0.7542 and sustained trading below 55 day EMA will pave the way back to 0.7144/7158 support zone. However, firm break of 0.7635 will dampen our bearish view and turn focus back to 0.7740 instead.

In the bigger picture, we're still treating price actions from 0.6826 low as a correction. And, as long as 38.2% retracement of 0.9504 to 0.6826 at 0.7849 holds, long term down trend from 1.1079 is expected to resume sooner or later. Break of 0.6826 low will target 0.6008 key support level. However, firm break of 0.7849 will indicate that rise from 0.6826 is developing into a medium term rebound, rather than a sideway pattern. In such case, stronger rise should be seek to 55 month EMA (now at 0.8164) and above.

Yen pared back some gains and turned mixed as risk aversion recedes. Dollar also trades mixed as traders await fresh directions. On the other hand, commodity currencies recovered in general and sentiments stabilized. Mild weakness is seen in Sterling into European session but that's yet to be confirmed. In other markets, Nikkei stays soft for most of the day and ended down -0.18% at 19344.15. That followed profit taking pull back in US overnight as DJIA closed down -0.24% at 20954.34. Gold stabilized at around 1225 and turned sideway after dipping from 1264.9 since last week. WTI crude oil also stabilized at around 53.

RBA stands pat

RBA left the cash rate unchanged at 1.50% as widely expected. Policymakers turned more upbeat on the economic outlook. as noted in the accompanying statement, "most measures of business and consumer confidence are at, or above, average", whilst "consumption growth was stronger towards the end of the year, although growth in household income remains low". The statement, however, added that "with growth in labour costs remaining subdued, underlying inflation is likely to stay low for some time". RBA also mentioned that the Fed is "expected to increase further" and it is less likely for other major central banks to add more monetary policy easing. More in RBA Maintains Neutral Bias In March. Fed Funds Rate Hike Alleviates Pressure On Aussie Appreciation

AUD/NZD resuming medium term rise

AUD/NZD is so far the biggest mover this week and one of the top movers since last month. The cross took out key medium term resistance level at 1.0769 while confirms resumption of whole rise from 1.0234. More importantly, the development affirms the case that long term correction from 1.1638 (2015 high) has already finished at 1.0234. Current up trend should target 161.8% projection of 1.0234 to .0762 at 1.0323 at 1.1177 next. Firm break there will affirm impulsiveness and would likely send the cross through 1.1638 high to 50% retracement of 1.3793 to 1.0016 at 1.1905 in medium term.

On the data front...

UK BRC retail sales dropped -0.4% yoy in February. German factory orders dropped -7.4% mom in January. Swiss will release foreign currency reserves in European session while Eurozone will release Q4 GDP final. US will release trade balance later in the day. Canada will also release trade balance plus Ivey PMI.

AUD/USD Daily Outlook

Daily Pivots: (S1) 0.7563; (P) 0.7586; (R1) 0.7602; More...

AUD/USD recovers further today but stays below 0.7635 minor resistance. Outlook is unchanged so far. Deeper fall is still in favor as long as 0.7635 minor resistance holds. We're holding on to the view that rebound from 0.7158 is finished at 0.7740. Below 0.7542 and sustained trading below 55 day EMA will pave the way back to 0.7144/7158 support zone. However, firm break of 0.7635 will dampen our bearish view and turn focus back to 0.7740 instead.

In the bigger picture, we're still treating price actions from 0.6826 low as a correction. And, as long as 38.2% retracement of 0.9504 to 0.6826 at 0.7849 holds, long term down trend from 1.1079 is expected to resume sooner or later. Break of 0.6826 low will target 0.6008 key support level. However, firm break of 0.7849 will indicate that rise from 0.6826 is developing into a medium term rebound, rather than a sideway pattern. In such case, stronger rise should be seek to 55 month EMA (now at 0.8164) and above.

Economic Indicators Update