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Daily Pivots: (S1) 1.6459; (P) 1.6486; (R1) 1.6513; More...

Intraday bias in EUR/AUD remains neutral for the moment. On the upside, decisive break of 1.6671 will revive the case that whole correction from 1.7062 has completed with three waves down to 1.6127. Further rally should then be seen to 1.6844 resistance for confirmation. Nevertheless, below 1.6455 minor support will turn bias to the downside for 1.6348 and possibly below.

In the bigger picture, fall from 1.7062 medium term top is seen as a correction to the up trend from 1.4281 (2022 low). Break of 1.6844 resistance will argue that this up trend is ready to resume through 1.7062 high. In case of another fall, strong support should be seen around 1.5846 and 38.2% retracement of 1.4281 to 1.7062 at 1.6000 to bring rebound.

Daily Pivots: (S1) 0.9519; (P) 0.9532; (R1) 0.9547; More...

Further rally is still expected in EUR/CHF with 0.9466 support intact. However, considering bearish divergence condition in 4H MACD, strong resistance could be seen from 0.9574 fibonacci resistance to limit upside. On the downside, break of 0.9466 support will indicate short term topping, and turn bias back to the downside.

In the bigger picture, price actions from 0.9252 are tentatively seen as a correction to the five-wave down trend from 1.0095 (2023 high). Further rise would be seen to 38.2% retracement of 1.0095 to 0.9252 at 0.9574 and possibly above. But overall medium term outlook will remain bearish as long as 0.9683 resistance holds.

Daily Pivots: (S1) 1.0809; (P) 1.0824; (R1) 1.0836; More...

Intraday bias in EUR/USD remains neutral at this point. On the upside, break of 1.0887 and sustained trading above 55 D EMA (now at 1.0831) will affirm the case that fall from 1.1138 has completed. Stronger rally would then be seen back to 1.1138. . However, break of 1.0761 will turn bias back to the downside for retesting 1.0694 support.

In the bigger picture, price actions from 1.1274 are viewed as a corrective pattern to rise from 0.9534 (2022 low). Rise from 1.0447 is seen as the second leg. While further rally could cannot be ruled out, upside should be limited by 1.1274 to bring the third leg of the pattern. Meanwhile, sustained break of 1.0694 support will argue that the third leg has already started for 1.0447 and possibly below.

Daily Pivots: (S1) 1.2647; (P) 1.2674; (R1) 1.2699; More...

Intraday bias in GBP/USD stays neutral for the moment. On the upside, break of 1.2708 resistance will indicate that correction from 1.2826 has completed. Intraday bias will be back on the upside for retesting 1.2826. Nevertheless, decisive break of 1.2499 will argue that whole rise from 1.2036 has completed and turn near term outlook bearish.

In the bigger picture, price actions from 1.3141 medium term top are seen as a corrective pattern to up trend from 1.0351 (2022 low). Rise from 1.2036 is seen as the second leg, which could be still in progress. But upside should be limited by 1.3141 to bring the third leg of the pattern. Meanwhile, break of 1.2499 support will argue that the third leg has already started for 38.2% retracement of 1.0351 (2022 low) to 1.3141 at 1.2075 again.

Daily Pivots: (S1) 0.8788; (P) 0.8804; (R1) 0.8827; More....

USD/CHF is staying in consolidation below 0.8884 and intraday bias stays neutral. With 0.8727 resistance turned support intact, further rally is expected. On the upside, above 0.8884 will resume the rally from 0.8332 to 100% projection of 0.8332 to 0.8727 from 0.8550 at 0.8954. However, sustained break of 0.8727 will dampen this bullish view, and turn bias back to the downside for 0.8550 support instead.

In the bigger picture, a medium term bottom should be formed at 0.8332, on bullish convergence condition in W MACD, just ahead of 0.8317 long term fibonacci support. It's still early to decide if the larger down trend from 1.0146 (2022 high) is reversing. But further rise should be seen to 0.9243 resistance even as a correction.

Daily Pivots: (S1) 150.28; (P) 150.52; (R1) 150.76; More...

Intraday bias in USD/JPY remains neutral as consolidation from 150.87 is extending. In case of another retreat, downside should be contained by 148.79 resistance turned support to bring rebound. On the upside, break of 150.87 will resume 140.25 to 151.89/93 key resistance zone. Decisive break there will confirm larger up trend resumption of 155.50 projection level next.

In the bigger picture, rise from 140.25 is seen as resuming the trend from 127.20 (2023 low). Decisive break of 151.89/.93 resistance zone will confirm this bullish case and target 61.8% projection of 127.20 to 151.89 from 140.25 at 155.50. However, break of 148.79 resistance turned support will delay this bullish case, and extend the corrective pattern from 151.89 with another falling leg.

Daily Pivots: (S1) 1.3475; (P) 1.3497; (R1) 1.3531; More...

Intraday bias in USD/CAD remains neutral and outlook is unchanged. With 1.3357 support intact, further rally is expected. On the upside, break of 1.3585 will resume the rebound from 1.3176 for 1.3897 resistance. However, break of 1.3357 will argue that the rebound from 1.3176 has completed and bring retest of this low.

In the bigger picture, price actions from 1.3976 (2022 high) are viewed as a corrective pattern only. In case of another fall, strong support should emerge above 1.2947 resistance turned support to bring rebound. Overall, larger up trend from 1.2005 (2021 low) is still expected to resume through 1.3976 at a later stage.

Key Highlights

• EUR/USD is attempting a fresh increase toward the 1.0930 resistance.
• It broke a major bearish trend line with resistance at 1.0815 on the 4-hour chart.
• GBP/USD is consolidating above the 1.2620 support.
• Gold price is facing resistance near the $2,040 level.

EUR/USD Technical Analysis

The Euro started a decent increase from the 1.0700 zone against the US Dollar. EUR/USD gained pace for a move above the 1.0780 and 1.0800 resistance levels.

Looking at the 4-hour chart, the pair traded above a major bearish trend line with resistance at 1.0815. There was a move above the 1.0850 level, but the bears faced resistance near the 1.0885 level. A high was formed near 1.0888 and the pair is now well above the 100 simple moving average (red, 4-hour).

However, the pair failed to settle above the 200 simple moving average (green, 4-hour). On the upside, the pair is facing resistance near the 1.0840 level.

A close above the 1.0840 zone could open the doors for more upsides. The next stop for the bulls might be 1.0885. Any more gains might send EUR/USD toward 1.0930.

Immediate support is near the 1.0800 level. The first major support sits near the 1.0780 level and the 100 simple moving average (red, 4-hour). The next major support sits at 1.0765, below which the pair might gain bearish momentum. In the stated case, the pair could even visit the 1.0720 support level.

Looking at Gold, the bulls are attempting a fresh increase but they are facing hurdles near the $2,040 level.

Economic Releases

• US New Home Sales for Jan 2024 (MoM) – Forecast +1.8% versus +8.0% previous.

Daily Pivots: (S1) 0.6549; (P) 0.6565; (R1) 0.6580; More...

Intraday bias in AUD/USD remains neutral for the moment and outlook is unchanged. Recovery from 0.6442 could extend higher, but outlook will remain bearish as long as 0.6621 resistance holds. On the downside, below 0.6520 minor support will turn bias to the downside for retesting 0.6442. Nevertheless, considering bullish convergence condition in 4H MACD, decisive break of 0.6621 will turn near term outlook bullish for 0.6870 resistance instead.

In the bigger picture, price actions from 0.6169 (2022 low) are seen as a medium term corrective pattern to the down trend from 0.8006 (2021 high). Fall from 0.7156 (2023 high) is seen as the second leg, which might still be in progress. Overall, sideway trading could continue in range of 0.6169/7156 for some more time. But as long as 0.7156 holds, an eventual downside breakout would be mildly in favor.

New Zealand Dollar weakens broadly in Asian session today, reflecting market caution ahead the RBNZ decision later this week, on concerns of less hawkish than expected outcome. The selloff in Kiwi is also dragging down Australian Dollar some what, while Yen and Dollar found some room to recover from last week's losses. At the same time, European majors are currently mixed. Nevertheless, all major currency pairs and crosses are maintaining their positions within Friday's range, with New Zealand Dollar being the sole exception.

The day's trading might remain subdued due to a nearly empty economic calendar. However, scheduled appearances by central bankers, including BoE Deputy Governor Sarah Breeden and Chief Economist Huw Pill, ECB President Christine Lagarde, and Kansas City Fed President Jeffrey Schmid, could inject some volatility into the markets. As the week progresses, the focus will shift to inflation data from US, Eurozone, Japan, and Australia, alongside other key economic indicators such as US durable goods orders, consumer confidence, and ISM manufacturing, as well as Swiss GDP, Canadian GDP, and Chinese PMIs.

Technically, Gold edges lower today but holds above 2015.82 support. At this point, it's unsure yet if the corrective fall from 2088.24 has completed with three waves down to 1984.05. Break of 2015.82 support will extend the pattern with another falling leg towards 1984.05 and possibly below. However, sustained break the the near term channel resistance will argue that rebound from 1972.86 is ready to resume through 2088.24. As always, the next movements in Gold will be instrumental in assessing the Dollar's direction, given their inverse relationship.

In Asia, at the time of writing, Nikkei is up 0.29%. Hong Kong HSI is down -0.31%. China Shanghai SSE is down -0.25%. Singapore Strait Times is down -0.92%. Japan 10-year JGB yield is down -0.0255 at 0.696, back below 0.7% handle.

Ethereum leads crypto charge with upside breakout

Ethereum staged an upside breakout over the weekend, and edged above 3100 mark. For the moment, it's outperforming Bitcoin is stuck in range after breaching 53000 briefly earlier in the month. There is prospect for Ethereum to continue to outshine Bitcoin in the near term, in anticipation of a new wave of spot crypto ETF on the world's second-largest digital asset.

The approval of the first spot Bitcoin ETFs by US regulators in January has already marked a significant milestone. These ETFs have attracted over USD 5B in net inflows since their inception on January 11. There is growing speculation that Ether ETFs could receive regulatory approval as soon as the second quarter, possibly in May.

Technically, Ethereum is in upside acceleration mode as seen in D MACD, and the break of channel resistance. Next target is 100% projection of 1519 to 2715 from 2164 at 3360. Considering overbought condition as seen in D RSI, upside might be limited there on first attempt and bring consolidations first. But in any case, outlook will stay bullish as long as 2715 resistance turned support holds. Meanwhile, decisive break of 3360 will pave the way to 161.8% projection at 4099 next, which is above 4k psychological level.

As for Bitcoin, outlook will stay bullish as long as 55 D EMA (now at 46376 holds). Decisive break of 61.8% projection of 24896 to 49020 from 38496 at 53404 will pave the way to 100% projection at 62620.

NZD retreats broadly as caution prevails ahead of RBNZ

New Zealand Dollar weakens broadly in Asian session, as market participants are likely adjusting their positions in anticipation of the upcoming RBNZ rate decision. This cautious approach stems from a blend of profit-taking and hedging against surprises that might deviate from some market expectations. Despite a robust rally earlier in the month, spurred by rate hike speculations, the prevailing market consensus leans towards a steady rate with a side of hawkish rhetoric from RBNZ. Investors are currently scaling back, wary of any outcomes that could fall short of the hawkish forecast.

Technically, with today's decline, immediate focus for NZD/USD is now on 55 4H EMA (now at 0.6153). Sustained break there will argue that the rebound from 0.6037 has completed as a three-wave corrective move to 0.6217. In this case, NZD/USD could be ready to resume the fall from 0.6368 through 0.6037 to 61.8% projection of 0.6368 to 0.6037 from 0.6217 at 0.6012 next.

Bearish divergence condition in 4H MACD argues that a short term top was already formed at 93.42 in NZD/JPY. Risk will now stay on the downside as long as 93.42 holds. Deeper fall would be seen to 55 4H EMA (now at 92.31) and below. But for now, considering the overall weakness in Yen, downside should be contained by 38.2% retracement of 89.24 to 93.42 at 91.82 to bring rebound.

RBNZ rate decision and global inflation watch

This coming week places RBNZ squarely in the limelight as it makes its highly anticipated rate decision. While the consensus among financial analysts is for RBNZ to hold official cash rate at 5.50%, the unanimity is not without its dissenters. Notably, ANZ has forecasted a 25bps increase, with expectations of an additional hike in April. This forecast hinges on the perception that RBNZ's current measures may fall short in adequately addressing inflation, which persisted at 4.7% in the fourth quarter, more than double the target.

RBNZ Governor Adrian Orr's recent remarks underscored the ongoing struggle against inflation, advocating for more decisive action to ensure inflation expectations are securely anchored around 2% mark. Orr's cautionary tone, although not convincing all economists of imminent further tightening, reinforces the argument against any expectations for rate cuts within this year.

Eventually, RBNZ's upcoming decision should be heavily influenced by the latest economic projections outlined in the quarterly Monetary Policy Statement. The prevailing wisdom suggests the central bank might opt to conserve its policy ammunition, delivering a hawkish narrative without altering rates. However, the door remains ajar for a surprise rate hike.

Beyond the shores of New Zealand, a slew of inflation data from US, Eurozone, Australia and Japan will draw significant market attention. Analysts and investors alike are keen to see if US PCE and core inflation data resonate with recent CPI report's implications of disinflationary pause. Such an outcome could lend weight to the argument favoring a Fed rate cut in the second half of the year, rather than the first.

ECB finds itself at a crossroads, with market participants eyeing rate cuts potentially starting in April or June. A slight deviation below expectations in the upcoming Eurozone CPI flash might not precipitate an immediate rate cut in March but could bring forward the timing to April. Conversely, unexpected inflationary pressures could push the window for easing to June.

Other notable economic indicators to watch include US durable goods orders, consumer confidence, and ISM manufacturing, along with Swiss GDP, Canadian GDP, and Chinese PMIs.

Here are some highlights for the week:

• Monday: Japan corporate service prices; US new home sales.
• Tuesday: Japan CPI; Germany Gfk consumer sentiment; Eurozone M3 money supply; US durable goods orders, house price index, consumer confidence.
• Wednesday: Australia monthly CPI; RBNZ rate decision; Germany import prices; Swiss Credit Suisse economic expectations; Canada current account; US CPI revision, goods trade balance.
• Thursday: Japan industrial production, retail sales, housing starts; New Zealand ANZ business confidence; Australia retail sales; Germany retail sales, CPI flash, unemployment; Swiss GDP, KOF economic barometer; UK M4 money supply, mortgage approvals; Canada GDP; US jobless claims, personal income and spending, PCE inflation, Chicago PMI, pending home sales.
• Friday: New Zealand building permits; Japan unemployment rate PMI manufacturing final, consumer confidence; China NBS PMIs, Caixin PMI manufacturing; Swiss retail sales PMI manufacturing; Eurozone PMI manufacturing final, CPI flash, unemployment rate; UK PMI manufacturing final; Canada PMI manufacturing; US PMI manufacturing final, ISM manufacturing.

AUD/USD Daily Report

Daily Pivots: (S1) 0.6549; (P) 0.6565; (R1) 0.6580; More...

Intraday bias in AUD/USD remains neutral for the moment and outlook is unchanged. Recovery from 0.6442 could extend higher, but outlook will remain bearish as long as 0.6621 resistance holds. On the downside, below 0.6520 minor support will turn bias to the downside for retesting 0.6442. Nevertheless, considering bullish convergence condition in 4H MACD, decisive break of 0.6621 will turn near term outlook bullish for 0.6870 resistance instead.

In the bigger picture, price actions from 0.6169 (2022 low) are seen as a medium term corrective pattern to the down trend from 0.8006 (2021 high). Fall from 0.7156 (2023 high) is seen as the second leg, which might still be in progress. Overall, sideway trading could continue in range of 0.6169/7156 for some more time. But as long as 0.7156 holds, an eventual downside breakout would be mildly in favor.

Economic Indicators Update