Sample Category Title

Pivot (invalidation): 5.2000

Our preference Long positions above 5.2000 with targets at 5.2420 & 5.2730 in extension.

Alternative scenario Below 5.2000 look for further downside with 5.1800 & 5.1570 as targets.

Comment The RSI is bullish and calls for further upside.

Pivot (invalidation): 0.7265

Our preference Short positions below 0.7265 with targets at 0.7205 & 0.7180 in extension.

Alternative scenario Above 0.7265 look for further upside with 0.7295 & 0.7325 as targets.

Comment A break below 0.7205 would trigger a drop towards 0.7180.

Pivot (invalidation): 1.3120

Our preference Short positions below 1.3120 with targets at 1.3060 & 1.3015 in extension.

Alternative scenario Above 1.3120 look for further upside with 1.3160 & 1.3185 as targets.

Comment The RSI is mixed to bearish.

Pivot (invalidation): 0.9945

Our preference Long positions above 0.9945 with targets at 0.9975 & 0.9995 in extension.

Alternative scenario Below 0.9945 look for further downside with 0.9925 & 0.9900 as targets.

Comment The RSI advocates for further advance.

Pivot (invalidation): 109.40

Our preference Long positions above 109.40 with targets at 109.75 & 110.00 in extension.

Alternative scenario Below 109.40 look for further downside with 109.15 & 108.95 as targets.

Comment A support base at 109.40 has formed and has allowed for a temporary stabilisation.

Daily Pivots: (S1) 142.38; (P) 142.94; (R1) 143.84; More...

GBP/JPY is staying in consolidation from 144.84 and intraday bias remains neutral. resistance at around 147.23. We'd expect strong resistance from there to limit upside, at least on first attempt. On the downside, firm break of 140.62 will suggest completion of the rebound and turn bias to the downside.

In the bigger picture, the strong rebound from 131.51 suggests that medium term fall from 156.59 (2018 high) has completed already. The corrective structure of such decline is turn argues that it's the second leg of the corrective pattern from 122.36 (2016 low). And this pattern is starting the third leg. On the upside, decisive break of 149.38 will pave the way to 156.59 resistance and above.

Pivot (invalidation): 1.3065

Our preference Long positions above 1.3065 with targets at 1.3100 & 1.3120 in extension.

Alternative scenario Below 1.3065 look for further downside with 1.3040 & 1.3015 as targets.

Comment A support base at 1.3065 has formed and has allowed for a temporary stabilisation.

Daily Pivots: (S1) 124.62; (P) 125.18; (R1) 126.00; More....

Intraday bias in EUR/JPY remains on the upside for 55 days EMA (now at 126.14). We'd be cautious on strong resistance from there to limit upside. And, break of 124.36 support will argue that the rebound has completed and turn bias to the downside. Nevertheless, sustained trading above 55 day EMA will pave the way back to 129.25 resistance next.

In the bigger picture, medium term rebound from 109.03 (2016 low) has completed at 137.49 already, with corrective structure. Fall from 137.39 is possibly just the second leg of the corrective pattern from 109.03. Break of 133.12 resistance should start the third leg to 137.49 and above. Nevertheless, break of 118.62 will resume the decline from 137.49 for 109.03/114.84 support zone instead.

Pivot (invalidation): 1.1465

Our preference Short positions below 1.1465 with targets at 1.1435 & 1.1410 in extension.

Alternative scenario Above 1.1465 look for further upside with 1.1490 & 1.1515 as targets.

Comment The RSI is bearish and calls for further downside.

• Rates: Slow start to trading week
  US Treasuries suffered a double blow last Friday after stronger US eco data (payrolls & manufacturing ISM). US Treasuries hover near the sell-off lows this morning with a thin calendar in front. Sentiment-driven, low volume trading within existing technical boundaries will be today’s recipe.
• Currencies: Strong US eco data fail to inspire directional USD move
  US payrolls and the manufacturing ISM printed (very) solid on Friday, but the reaction hardly filtered through into USD trading. Today, the eco calendar is thin. Price action of last week suggests that the downside in EUR/USD might be rather well protected. UISD/JPY is nearing the 110 barrier.

The Sunrise Headlines

• US equity markets closed last week’s session with gains/losses between -0.25% and +0.25% . Asian equities are trading mixed with Japanese indices outperforming. Chinese markets are closed for the week.
• Venezuelans marched in duelling protest on Saturday, with both sitting President Maduro and US-backed Guaido claiming power of the nation .US President Trump said that use of US military force remains “an option”.
• US President Trump intends to keep a military presence in Iraq to keep tabs on Iran. He will ignore intelligence officials if their view differs from his. Next, he’s confident that deals with both China and North Korea are on the horizon.
• Stephen Barclay, UK Brexit minister, is setting up a new working group of Conservative lawmakers to find an alternative plan to avoid a post-Brexit border in Ireland. Meanwhile, the EU still rules out a reopening of the exit deal.
• Approvals to build new homes in Australia collapsed to five-year lows in December as sliding house prices and a squeeze on credit hammered the apartment market. (Reuters)
• Oil prices held gains near two-month highs after US production growth is slowing to the lowest level in 9 months, in times of OPEC supply cuts and US sanctions on Venezuela. A barrel of crude (Brent) oil changes hands at $62.75.
• Today’s economic calendar is feather light with EMU producer inflation data, and the UK Markit/CIPS Construction PMI. Alphabet (Google) reports Q4 earnings. Chinese markets are closed for the week

Currencies: Strong US Eco Data Fail To Inspire Directional USD Move

EUR/USD largely ignores strong US data

USD trading calmed down on Friday. The reaction to Wednesday’s Fed decision and the subsequent euro decline on Thursday had run their course. EMU eco data (final PMI’s and Jan CPI) were again soft but as expected. EUR/USD started a cautious technical intraday rebound. US payrolls and the manufacturing ISM (56.6) were strong, but neither was able to cause a protracted USD rebound. Interest rate differentials between the USD and the euro rewidened on the strong US data, but hardly filtered through into the FX market. EUR/USD finished the day at 1.1456 (from 1.1448). The price pattern of USD/JPY was a bit more convincing. USD/JPY closed the week at 109.50 (108.89 on Thursday). This morning, Asian equities (Chinese and Korean markets are closed) are trading mixed to cautiously higher. USD/JPY (109.75) extends Friday’s rebound. The 110 ST range top is coming within reach. The Aussie dollar declined as December building approvals printed very weak (-22.5% Y/Y). Uncertainty on housing and mortgage markets might be an issue at tomorrow’s RBA policy meeting. EUR/USD is trading with a minor negative bias this morning (1.1440 area). There are only second tier eco data in EMU today. In the US, the order data are scheduled for release. We don’t expect these data to really affect market sentiment in the wake of last week’s change in the Fed’s communication. During the weekend, US president Trump sounded quite optimistic on the US-China trade talks. However, there probably won’t come any concrete news on this issue anytime soon. Risk-sentiment looks neutral to slightly constructive. Last week, the post-Fed USD decline halted soon, mainly due to poor EMU eco data. However, the subsequent USD comeback also had no strong legs. More sideways EUR/USD trading might be in the cards. Given the price action at the end of last week, we assume the EUR/USD downside to be rather well protected. USD/JPY maintains a constructive momentum. A break beyond the 110 resisistance would further improve the technical picture.

EUR/GBP initially rebounded on Friday as investors took further profit on the recent sterling rebound. A soft UK manufacturing PMI weighted on sentiment, too. However, sterling selling eased later in the session. This week’s, talks between the UK and EMU on Brexit will continue. However, a workable solution is not evident. A cautious BoE (Thursday) and a soft inflation outlook might be also cap further GBP-gains.

EUR/USD: USD shows no clear trend despite strong US eco data