Sample Category Title

Daily Pivots: (S1) 1.1514; (P) 1.1558; (R1) 1.1585; More.....

EUR/USD is staying in tight range below 1.1622 and intraday bias stays neutral. With 1.1493 minor support intact, further rise could be seen. But rebound from 1.1300 is seen as a correction. Hence, we'd expect strong resistance from 1.1745 to limit upside to bring larger down trend resumption. On the downside, break of 1.1493 minor support will suggest that the rebound is completed. Intraday bias would be turned back to the downside for retesting 1.1300 low.

In the bigger picture, the down trend from 1.2555 medium term is in progress for 61.8% retracement of 1.0339 to 1.2555 at 1.1186. Note again that EUR/USD was rejected by 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. That carries some long term bearish implications. Sustained break of 1.1186 could pave the way back to retest 1.0339 low. For now, outlook will remain bearish as long as 38.2% retracement of 1.2555 to 1.1300 at 1.1779 holds, even in case of strong rebound.

For the 24 hours to 23:00 GMT, Silver declined 1.65% against the USD and closed at USD14.59 per ounce.

In the Asian session, at GMT0300, the pair is trading at 14.61, with silver trading 0.14% higher against the USD from yesterday’s close.

The pair is expected to find support at 14.53, and a fall through could take it to the next support level of 14.44. The pair is expected to find its first resistance at 14.73, and a rise through could take it to the next resistance level of 14.84.

The white metal is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.

Daily Pivots: (S1) 1.2773; (P) 1.2846; (R1) 1.2889; More...

Breach of 1.2811 minor support suggests that corrective rebound from 1.2661 has completed at 1.2935 already. Intraday bias is turned back to the downside for retesting 1.2661 low first. Break will resume larger down trend from 1.4376. On the upside, in case of another rebound, we'd still expect upside to be limited by 1.2956 support turned resistance. However, decisive break of 1.2956 will turn focus to 1.3212 key resistance instead.

In the bigger picture, whole medium term rebound from 1.1946 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4091). Current downside acceleration argues that it's possibly resuming long term down trend. In any case, outlook will stay bearish as long as 1.3212 resistance holds. Retest of 1.1946 should be seen next.

For the 24 hours to 23:00 GMT, Crude Oil declined 0.22% against the USD and closed at USD67.86 per barrel, amid signs of tightening US crude inventories.

In the Asian session, at GMT0300, the pair is trading at 68.12, with oil trading 0.38% higher against the USD from yesterday’s close, on expectations that the US sanctions on Iran will reduce significant volumes of crude from the oil market towards the end of 2018.

The pair is expected to find support at 67.57, and a fall through could take it to the next support level of 67.03. The pair is expected to find its first resistance at 68.41, and a rise through could take it to the next resistance level of 68.71.

Crude oil is trading above its 20 Hr and 50 Hr moving averages.

Daily Pivots: (S1) 0.9832; (P) 0.9849; (R1) 0.9877; More....

USD/CHF is staying in consolidation above 0.9807 temporary low and intraday bias remains neutral. Deeper decline could be seen with 0.9889 minor resistance intact. On the downside, break of 0.9807 will target 100% projection of 1.0067 to 0.9866 from 0.9981 at 0.9780 and possibly below. But fall from 1.0067 is seen as the third leg of the consolidation pattern from 1.0056. Hence, we'd expect strong support from 38.2% retracement of 0.9186 to 1.0056 at 0.9724 to bring rebound. On the upside, above 0.9889 will turn bias to the upside for 0.9981 resistance first. Break will bring retest of 1.0067 high.

In the bigger picture, current development suggests that the consolidation pattern from 1.0056 is extending. As long as 38.2% retracement of 0.9186 to 1.0056 at 0.9724 holds, we'd expect rise from 0.9186 to resume at a later stage to retest 1.0342 key resistance (2016 high). However, sustained break of 0.9724 fibonacci level will bring deeper fall, as another declining leg in the long term range pattern.

Daily Pivots: (S1) 110.77; (P) 111.04; (R1) 111.57; More...

USD/JPY's rebound from 109.76 extends to as high as 111.48 so far. Break of 111.42 minor resistance argues that the correction from 113.17 has completed at 109.76 already. Intraday bias is back on the upside for 112.14 first. Break will bring retest of 113.17 high. On the downside, below 110.74 minor support will turn bias back to the downside for retesting 109.76 again. But after all, we'd continue to expect strong support around 38.2% retracement of 104.62 to 113.17 at 109.90 to bring rebound.

In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.36 support holds. However, decisive break of 109.36 will mix up the outlook again. And deeper fall should be seen back to 61.8% retracement of 104.62 to 113.17 at 107.88 and below.

Daily Pivots: (S1) 1.3016; (P) 1.3058; (R1) 1.3123; More...

USD/CAD's breach of 1.3091 suggests minor resistance suggests that fall from 1.3173 is possibly completed at 1.2986 already. More importantly, the rebound head of medium term channel support saves bullishness in the pair. Intraday bias is turned back to the upside for 1.3173 resistance. Break there will indicate completion of fall from 1.3385 and turn outlook bullish again. However, sustained trading below the channel support (now at 1.2982) will carry larger bearish implication and turn outlook bearish.

In the bigger picture, as long as channel support (now at 1.2982) holds, we're holding to the bullish view. That is, fall from 1.4689 (2015 high) has completed at 1.2061, ahead of 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048. Further rally should be seen for 61.8% retracement of 1.4689 to 1.2061 at 1.3685 and above. However, sustained break of the channel support will argue that rise from 1.2061 has completed. Further decline should be seen to 38.2% retracement of 1.2061 to 1.3385 at 1.2879 first. Sustained break will pave the way to 61.8% retracement at 1.2567 and below.

Daily Pivots: (S1) 0.7206; (P) 0.7282; (R1) 0.7323; More...

AUD/USD recovers notably after dipping to 0.7237. But still intraday bias stays on the downside with 0.7302 minor resistance intact. Corrective rise from 0.7201 should have completed at 0.7381. Deeper fall is expected to 0.7201 low first. Firm break there will resume larger down trend from 0.8135. In that case, 0.7158 medium term support will be the next target. On the upside, above 0.7302 minor resistance will turn intraday bias neutral first. And, even in case that correction from 0.7201 extends with another rise, we'd expect upside to be limited by 0.7452 resistance to bring larger down trend resumption eventually.

In the bigger picture, rebound from 0.6826 (2016 low) is seen as a corrective move that should be completed at 0.8135. Fall from there would extend to have a test on 0.6826. There is prospect of resuming long term down trend from 1.1079 (2011 high). But we'll look at downside momentum to assess at a later stage. On the upside, break of 0.7452 resistance, however, will indicate medium term bottoming, on bullish convergence condition in daily MACD. In that case, a correction should be seen first, with stronger rebound would be seen to 38.2% retracement of 0.8135 to 0.7201 at 0.7558. The down trend from 0.8135 will resume after the correction completes.

Australia Dollar recovers broadly today as markets cheered Scott Morrison's win in the Liberal Party's leadership challenge. But upside is so far limited. New Zealand Dollar is trading as the second strongest one for today so far, followed by Dollar. On the other hand, Yen is under broad based pressure, together with Canadian Dollar.

In other markets, Asian stocks are mixed with Nikkei trading up 0.71% after data showed CPI stalled in July. Hong Kong HSI, China SSE and Singapore Strait Times are all down, -0.69%, -0.35% and -0.62% respective. Gold continues to gyrate lower towards 1180.

For the week, Euro is trading as the strongest one, followed by Swiss Franc and Sterling. Nonetheless, the Pound's position is a bit vulnerable as it suffered steep selling overnight. Yen is trading as the weakest, followed by Australian Dollar and Canadian Dollar.

Fed chair Jerome Powell's speech at the Jackson Hole symposium will catch a lot of attention. We're not expecting anything drastic from there, given Powell's composed and balanced personality. Also, Fed is pretty much on auto-pilot now regarding monetary policies. There are two areas that might still trigger market volatility. That is, will there be early end of balance sheet reduction? And, will Fed return to pre-crisis channel system? More in Jackson Hole Symposium Preview: Two Questions on Fed's Monetary Policy

Technically, GBP/USD's break of 1.2811 minor support overnight indicates completion of rebound from 1.2661. Further decline is now in favor to retest this 1.2661 low. The Pound will be a focus today as EUR/GBP is set to test 0.9030 resistance while GBP/CHF will test 1.2589 support. USD/JPY's break of 111.42 indicates near term reversal and we'd likely see further upside ahead. USD/CAD also defended medium term channel support and could be heading back to 1.3173 resistance.

Australian Dollar recovers broadly on ScoMo win, but upside limited

Australian Dollar recovers broadly today as Treasurer Scott Morrison becomes the next Prime Minister, winning a three way race with Foreign Minister Julie Bishop and former Home Affairs Minister Peter Dutton after Malcolm Turnbull was ousted. That's the sixth change in prime ministership in a less than a decade.

ScoMo, as Morrison has come to be known, is seen as the most market-friendly option. In particular, as under him as Treasurer, there was substantial improvement in budget balance in Australia.

However, the rebound is limited as the markets are probably looking through to next year's general election already. Bigger uncertainty lies ahead as there is a good chance of a Labor win while results in a change of government and policy directions.

RBNZ Orr: New Zealand fundamentals strong but biggest challenge is to get inflation to rise

RBNZ Governor Adrian Orr said in a Bloomberg interview at Jackson Hole that the economy is well supported with a "very supportive exchange rate" and "strong terms of trade". The fundamentals for New Zealand are strong with "stable monetary policy", "low inflation", "very good fiscal account", "accommodative exchange rate" and it's a "very positive story". But the country has come a period of strong population growth which is easing, therefore, the focus is shifted from "consumption" to "earning.

The "biggest challenge" is to "get inflation to rise" as it's below mid-point of 1-3% target for a couple of years. To do that, Orr reiterated that RBNZ will hold interest rate low for a long period of time and it's "in no rush to raise interest rate". And, Orr also emphasized that "we don't rule out a cut" if necessary.

According to Orr, trade war will have to be very real and vicious before having an impact on New Zealand significantly. And, trade income will have to fall quite considerably before affecting the country's term of trade.

Canadian Trudeau: We work on a good NAFTA deal, not just any deal

The bilateral NAFTA talks between the US and Mexico continued to drag on. Mexican Economy Minister Ildefonso Guajardo said in Washington yesterday that "we're on a path that can take us into the weekend and next week." And, "we are well advanced (but) not there yet." Guajardo also said "we need to get an engagement with Canada and the only way that can happen is if we continue through the weekend and into next week."

Separately, Canadian Prime Minister Justin Trudeau said in British Columbia the "we are encouraged by the optimism expressed by the U.S. and Mexico". But he emphasized that "we will only sign a good deal for Canadians." And, "we're working to achieve a good deal, not just any deal."

Foreign Minister Chrystia Freeland added, "in order to get to the ultimate goal that we all share of modernizing and updating Nafta, obviously it's important to resolve the bilateral issues." And, "our plan is then ultimately to move on to the trilateral issues."

Low-level US-China trade talks ended with no result

The low-level trade talks between delegation led by US Treasury Under Secretary David Malpass and Chinese Commerce Vice Minister Wang Shouwen ended without any progress.

White House spokesperson Lindsay Walters said in an email statement that "we concluded two days of discussions with counterparts from China and exchanged views on how to achieve fairness, balance, and reciprocity in the economic relationship."

The Chinese Ministry of Commerce said in a brief statement that both sides conducted "constructive and frank exchanges" and "will maintain contact for the next step."

A fresh round of tariffs on USD 16B of goods of both sides kicked in yesterday and trade war between US and China continued.

On the data front

New Zealand trade deficit narrowed to NZD -143m in July, better than expectation of NZD -400m. Japan national CPI core was unchanged at 0.80% yoy in July, below expectation of 0.9% yoy. Germany will release Q2 GDP final. UK will release BBA mortgage approvals. Later in the day US durable goods orders will be featured.

AUD/USD Daily Outlook

Daily Pivots: (S1) 0.7206; (P) 0.7282; (R1) 0.7323; More...

AUD/USD recovers notably after dipping to 0.7237. But still intraday bias stays on the downside with 0.7302 minor resistance intact. Corrective rise from 0.7201 should have completed at 0.7381. Deeper fall is expected to 0.7201 low first. Firm break there will resume larger down trend from 0.8135. In that case, 0.7158 medium term support will be the next target. On the upside, above 0.7302 minor resistance will turn intraday bias neutral first. And, even in case that correction from 0.7201 extends with another rise, we'd expect upside to be limited by 0.7452 resistance to bring larger down trend resumption eventually.

In the bigger picture, rebound from 0.6826 (2016 low) is seen as a corrective move that should be completed at 0.8135. Fall from there would extend to have a test on 0.6826. There is prospect of resuming long term down trend from 1.1079 (2011 high). But we'll look at downside momentum to assess at a later stage. On the upside, break of 0.7452 resistance, however, will indicate medium term bottoming, on bullish convergence condition in daily MACD. In that case, a correction should be seen first, with stronger rebound would be seen to 38.2% retracement of 0.8135 to 0.7201 at 0.7558. The down trend from 0.8135 will resume after the correction completes.

Economic Indicators Update

Australian Dollar recovers broadly today as Treasurer Scott Morrison becomes the next Prime Minister, winning a three way race with Foreign Minister Julie Bishop and former Home Affairs Minister Peter Dutton after Malcolm Turnbull was ousted. That's the sixth change in prime ministership in a less than a decade.

ScoMo, as Morrison has come to be known, is seen as the most market-friendly option. In particular, as under him as Treasurer, there was substantial improvement in budget balance in Australia.

However, the rebound is limited as the markets are probably looking through to next year's general election already. Bigger uncertainty lies ahead as there is a good chance of a Labor win while results in a change of government and policy directions.