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Ethereum is trading sharply higher on Wednesday, with the third largest cryptocurrency by market capitalization now trading above the psychological $100.00 level. The ETHUSD pair has an intraday bullish bias while trading above the $96.00 level, which is neckline of a bullish inverted head and shoulders pattern. If the recent short-term recovery extends towards the $125.00 level, the ETHUSD pair could form a larger inverse head and shoulders pattern.

The ETHUSD pair is bullish while trading above the $96.00 level, buyers are likely to test towards the $118.00 and $126.00 levels.

If ETHUSD pair falls below the $100.00 level, sellers may test the 96.00 and $88.10 levels.

Daily Pivots: (S1) 141.90; (P) 142.28; (R1) 142.63; More...

Intraday bias in GBP/JPY remains neutral at this point. Near term outlook remains bearish with 144.02 support turned resistance intact. On the downside, below 141.17 will resume the fall from 149.70 and target 139.29/47 key support zone. However, considering bullish convergence condition in 4 hour MACD, decisive break of 144.02 will suggest near term reversal. Stronger rally should then be seen to 55 day EMA (now at 144.96) and above.

In the bigger picture, as long as 139.29 cluster support (50% retracement of 122.36 to 156.59 at 139.47) holds, up trend from 122.36 (2016 low) could still extend beyond 156.69 high. However, decisive break of 139.29/47 will suggest that such up trend is completed and turn outlook bearish. In that case, next target is 61.8% retracement at 135.43.

The British pound is holding above the important 1.2660 level against the US dollar, ahead of the release of important inflation data from the United Kingdom economy this morning. The recent rally higher was once again capped by the GBPUSD pairs 100-period moving average on the four-hour time frame. If GBPUSD buyers can break through this key resistance area, further upside towards the 1.2770 level seems possible.

The GBPUSD pair is bullish while trading above the 1.2660 level, buyers may test towards the 1.2700 and 1.2770 levels.

If the GBPUSD pair falls from current levels, sellers will likely test the 1.2620 and 1.2580 support levels.

Daily Pivots: (S1) 127.64; (P) 127.88; (R1) 128.11; More....

Intraday bias in EUR/JPY remains neutral first as it's bounded in range of 127.61/129.25. On the downside, break of 127.61 support will resume the fall from 130.14 and target 126.63 support first. Break there will then resume the whole decline from 133.12 to 124.08/89 support zone. Overall, consolidation from 126.63 could still extend. But even in case of another strong recovery, outlook will stay bearish as long as 130.14 resistance holds.

In the bigger picture, as long as 124.08 key resistance turn supported holds, larger up trend from 109.03 (2016 low) could still resume. Firm break of 137.49 structural resistance will target 141.04/149.76 resistance zone next. However, decisive break of 124.08 will argue that such rise from 109.03 has completed and turn outlook bearish. In that case, deeper fall would be seen to 61.8% retracement of 109.03 to 137.49 at 119.90.

The euro currency remains well-bid against the US dollar in early Wednesday trade, as traders continue to buy any dips-lower in the pair. The 1.1400 resistance level remains the key technical area to watch today, with a break above the 1.1400 level likely to accelerate technical buying towards the EURUSD pairs 100-day moving average. The 1.1360 level is the key support level to watch, with traders likely to use this area as a key daily pivot point.

The EURUSD pair is only bullish while trading above the 1.1360 level, key technical resistance remains at the 1.1400 and 1.1470 levels.

If the EURUSD pair falls below the 1.1360 level, sellers are likely to test the 1.1330 and 1.1268 support levels.

Daily Pivots: (S1) 0.8965; (P) 0.8989; (R1) 0.9014; More...

Intraday bias in EUR/GBP remains neutral for the moment. As long as 0.8931 resistance turned support holds, further rally is expected in the cross. On the upside, decisive break of 0.9098 resistance will extend the rally from 0.8655 and target 0.9304 key resistance next. However, considering bearish divergence condition in 4 hour MACD, firm break of 0.8931 will indicate near term reversal and target 0.8810 support and below.

In the bigger picture, EUR/GBP is seen as staying in long term range pattern started at 0.9304 (2016 high). It should be in medium term rising leg for 0.9304. Meanwhile, in case of another fall, down side should be contained by 0.8620/55 support zone to bring rebound.

Daily Pivots: (S1) 1.5769; (P) 1.5814; (R1) 1.5861; More....

Intraday bias in EUR/AUD remains neutral and consolidation from 1.5887 might extend. In case of another retreat, downside should be contained by 1.5596 support to bring another rally. On the upside, break of 1.5887 will target 1.5984 support turned resistance first. Break will pave the way to retest 1.6357 high next. However, break of 1.5596 will suggest that the rebound is completed. Intraday bias would then be turned back to the downside for 1.5346 low.

In the bigger picture, no change in the view that 1.6357 is a medium term top. But the strong rebound ahead of 1.5271 cluster support (38.2% retracement of 1.3624 to 1.6357 at 1.5313) suggests price actions from 1.6357 are developing into sideway consolidation, rather than a deep correction. The range of 1.5271/6357 is likely set for the consolidation. And we don't expect a break of the range any time soon. But decisive break of 1.6357 will resume the larger up trend from 1.3624 (2017 low) to 1.6587 (2015 high).

Daily Pivots: (S1) 1.1260; (P) 1.1279; (R1) 1.1301; More...

EUR/CHF's rebound from 1.1224 short term bottom resumes today by breaking 1.1301 minor resistance. Intraday bias is turned back to the upside for 1.1356 resistance first. Decisive break there should confirm near term reversal. In that case, further rally should be seen back to 1.1501 resistance. On the downside, below 1.1267 minor support will dampen this bullish case and turn focus back to 1.1224 low instead.

In the bigger picture, price actions from 1.2004 medium term top is seen as a correction only. Downside should be contained by support zone of 1.1198 (2016 high) and 61.8% retracement of 1.0629 to 1.2004 at 1.1154 to complete it and bring rebound. A break of 1.2 key resistance is still expected in the medium term long term. However, sustained break of the mentioned support zone will mark reversal of the long term trend. In that case, 1.0629 key support will be back into focus.

EUR/USD

Current level - 1.1385

A new test of 1.1400 and 1.1440 is expected.  First support is 1.1340 followed by 1.1270.

USD/JPY

Current level - 112.31

The trend remains negative after the bounce from 113.70. The expectations are for a decline towards 112.22 and a slight retracement afterwards. If the break of 112.22 is successful the new target would be around 111.75.

GBP/USD

Current level - 1.2674

We are seeing a slight optimism in the British pound. I expect a new test of the resistance zone at 1.2700. For the bulls to take over they'll need a successful break of that level. On the contrary this could bring back the pair to the levels around 1.2550 - 1.2500.

General Trend:

• Equities markets mixed throughout the session with little catalyst to push a firm direction, markets await US Fed final meeting of 2018 and BoJ policy decision
• Shares of Softbank fall over 10% after Mobile unit spin off opens for trade below pricing, dragging Nikkei 225 to the lowest level since late March in the first 10 minutes of trade. Nearly an hour into trade losses reversed.
• Japan trade balance starting to show impacts of trade tensions with exports nearly unchanged
• USD remains broadly weaker, sovereign bond yields decline around the globe. In Japan, Japan Securities Clearing Corporation (JSCC): Emergency margin call has been triggered for JGB futures
• PBoC again used reverse repos in OMO operations, yuan made little moves with no new trade talks news
• China Economic Work Conference has started, awaiting comments to show targets and policies for what is expected to be a rocky 2019 with China slowing and trade war impacts

Headlines/Economic Data

Japan

• Nikkei 225 opened slightly lower
• (JP) Japan PM Abe: New budget has ample room to overcome effects of sales tax increase
• (JP) Japan Coalition Party Leader Yamaguchi: Budget to be approved by Cabinet as soon as Friday
• (JP) JAPAN NOV BALANCE OF TRADE: -¥737.3B V -¥630BE; ADJ TRADE BALANCE: -¥492.2B V -¥275BE; Exports y/y: 0.1% v 1.2%e , Imports y/y: 12.5% v 11.8%e
• 7270.JP Subaru said to plan to reduce Japan output by 40K units - Japanese press
• (JP) Japan FY19/20 initial budget seen at ¥101.5T (1st time over the ¥100T level) - financial press
• TAK Takeda Announces Listing of American Depositary Shares on the New York Stock Exchange on Dec 24th
• 9432.JP Japan govt to cut stake in NTT in 2019 totaling ¥160B – Nikkei
• 9984.JP Mobile IPO opens for trade at ¥1,463/shr v ¥1,500/shr pricing
• Looking ahead: BOJ holding its policy meeting Dec 19-20th ; expected to leave policy unchanged in tomorrow’s announcement

Korea

• Kospi opened +0.3%
• (KR) South Korea Fin Min Hong has asked US Treasury Sec Mnuchin for exemption from tariffs on imported vehicles - Yonhap
• (KR) Bank of Korea (BOK) Nov Minutes: Necessary to focus on resolving fiscal imbalances; One dissenter: Domestic growth faces bigger downside risks. With inflation still soft, slower growth in Japan, the EU and China may weigh on Korean exports
• (KR) Bank of Korea (BOK) sells KRW2.0T in 2-yr Monetary Stabilization Bonds (MSBs) at 1.82% v 1.93% prior
• 036460.KR Prelude LNG to start commercial production in Q1 2019
• (KR) Bank of Korea (BOK) Gov Lee: See minor impact from US rate gap on flows into bonds; Not expecting economy, market situation to worsen in 2019
• (KR) South Korea Fin Min Hong: To talk about economy and risks with BOK Gov Lee; 2019 economic conditions not looking good due to external risks
• (KR) North Korea 2017 Trade volume $5.55B v $6.53B in 2016, impacted by sanctions – Yonhap
• (KR) Bank of Korea (BOK) Gov Lee: Expression of policy harmony by Fin Min Hong has nothing to do with interest rate policy direction; we both share the view that economic conditions for 2019 are not good

China/Hong Kong

• Hang Seng opened +0.2%, Shanghai Composite +0.1%
• (HK) Hong Kong starter subsidized apartments to be sold for HK$3-7M – SCMP
• (CN) China PBoC Open Market Operation (OMO): Injects CNY60B in 7-day and 14-day Reverse Repos v injects CNY180B in 7-day and 14-day prior; Net injects CNY60B v CNY180B prior
• (CN) China PBoC sets yuan reference rate: 6.8869 v 6.8854 prior
• (CN) China housing rental market expected to reach CNY3.0T with 252M renters by 2025 v CNY1.2T currently – SCMP
• (CN) China MoF Sells 1-yr bonds at 2.6385% v 2.57%e, bid to cover 1.56x; Sells 10-yr bonds at 3.2875% v 3.36%e, bid to cover 2.21x
• (CN) China Commerce Ministry (MOFCOM): China and US have spoken on the phone Dec 19th on trade and economy on a Vice Min level
• Looking ahead: Awaiting comments from China Economic Work Conference

Australia/New Zealand

• ASX 200 opened -0.3%
• (NZ) New Zealand Q3 Westpac Consumer Confidence: 109.1 v 103.5 prior
• (NZ) Fonterra Global Dairy Trade Auction: Dairy Trade price index: +1.7% v +2.2% prior
• TLX.AU Updates on Japan regulatory process for TLX250-CDx; completes enrollment for its ZIR-DOSE clinical study
• (NZ) New Zealand Q3 Current Account (NZD): -6.2B v -5.9Be
• (AU) Australian Prudential Regulation Authority (APRA): To remove interest only home loan benchmark, effective Jan 1st, 2019
• (NZ) New Zealand to raise minimum wage NZ$1.20/hr to NZ$17.70/hr, effective April 1st
• BGA.AU Will have increased depreciation charges on Koroit Infrastructure; Guides FY19 normalized Net A$44-48M; EBITDA A$123-130M v 109.6M y/y
• (AU) Australia Nov Westpac Leading Index m/m: -0.1% v +0.1%e
• (AU) RBA Gov Lowe said to have held meetings with each of the large banks, warning them against over tightening credit supply - Australian
• Looking ahead: New Zealand to release trade balance and Q3 GDP; Australia releasing Nov employment data tomorrow

Other Asia

• (MY) Malaysia Nov CPI y/y: 0.2% v 0.4%e

North America

• (US) SEMI: Nov North America Billings $1.94B v $2.03B prior, -4.2% m/m and -5.3% y/y
• (US) Weekly API Oil Inventories: Crude: +3.5M v -10.2M prior
• FDX Will no longer provide FY19 Rev and Op margin guidance (prior Rev +9% y/y, operating margin 8.5%) - earnings call
• PAYX Reports Q2 $0.65 v $0.63e, Rev $858.9M v $856Me (official results expected pre-market US) - US financial press
• (US) Senate passes bipartisan criminal justice bill

Europe

• (UK) Business leaders want PM May to call a referendum on her Brexit deal
• (UK) Minor UK opposition parties table vote of no confidence in government - financial press
• (UK) UK puts 3.5K troops on standby to deal with reaction to a no deal Brexit - press

Levels as of 12:50ET

• Hang Seng +0.2%; Shanghai Composite -0.6%; Kospi +0.7%; Nikkei225 -0.7%; ASX 200 -0.2%
• Equity Futures: S&P500 +0.6%; Nasdaq100 +0.5%, Dax +0.4%
• EUR 1.1337-1.1402; JPY 112.19-112.60 ; AUD 0.7177-0.7200;NZD 0.6845-0.6870
• Feb Gold +0.1% at $1,254/oz; Feb Crude Oil +0.5% at $46.80/brl; Mar Copper +1.1% at $2.68/lb