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EUR/GBP Daily Outlook
Daily Pivots: (S1) 0.8847; (P) 0.8872; (R1) 0.8894; More...
Intraday bias in EUR/GBP remains on the downside with 0.8896 minor resistance intact. Fall from 0.8967 should target 0.8871 support first. Break there will confirm completion of rebound from 0.8686 and target a retest of this low. On the upside, above 0.8896 minor resistance will turn bias neutral first. Further break of 0.8967 will resume the rebound from 0.8686 to 61.8% retracement of 0.9305 to 0.8686 at 0.9069.
In the bigger picture, there are various ways to interpret price actions from 0.9304 high. But after all, firm break of 0.9304/5 is needed to confirm up trend resumption. Otherwise, range trading will continue with risk of deeper fall. And in that case, EUR/GBP could have a retest on 0.8303. But we'd expect strong support from 0.8116 cluster support (50% retracement of 0.6935 to 0.9304 at 0.8120) to contain downside.
EUR/AUD Daily Outlook
Daily Pivots: (S1) 1.5631; (P) 1.5658; (R1) 1.5693; More....
Intraday bias in EUR/AUD remains on the downside with focus on 1.5626 support. Decisive break there extend the decline from 1.5976 to 61.8% retracement of 1.5153 to 1.5976 at 1.5467 and below. On the upside, above 1.5787 minor resistance will turn bias back to the upside for retesting 1.5976 high instead.
In the bigger picture, change of medium term reversal is increasing with EUR/AUD just missing double projection target. They are 61.8% projection of 1.4421 to 1.5770 from 1.5153 at 1.5987, and 100% projection of 1.3624 to 1.5226 from 1.4421at 1.6023. Also, bearish divergence condition remains in daily MACD. Break of 1.5626 support will add to this bearish case and target 1.5153 key support for confirmation. Nonetheless, before that happens, as long as 1.5153 support holds, medium term rise from 1.3624 could still extend to retest 1.6587 high.
EUR/CHF Daily Outlook
Daily Pivots: (S1) 1.1668; (P) 1.1692; (R1) 1.1710; More...
EUR/CHF is staying in consolidation below 1.1740 temporary top. Intraday bias remains neutral first. As noted before, pull back from 1.1832 is already completed at 1.1445. Further rise will be in favor as long as 1.1630 minor support holds. Above 1.1740 will target a test on 1.1832 high. We'll stay cautious strong resistance from there to bring another fall. Corrective pattern from 1.1832 might still have an attempt on 1.1355 cluster support (38.2% retracement of 1.0629 to 1.1832 at 1.1372) before completion. On the downside, below 1.1630 minor support will target 1.1445 low again.
In the bigger picture, a medium term top should be in place at 1.1832 on bearish divergence condition in daily MACD. But there is no indication of long term reversal yet. As long as 1.1198 resistance turned support holds, we'd still expect another rise through prior SNB imposed floor at 1.2000.
Australia’s NAB Business Conditions Jumped To A Record High In February
For the 24 hours to 23:00 GMT, the AUD rose 0.08% against the USD and closed at 0.7869.
LME Copper prices rose 0.7% or $49.0/MT to $6857.0/MT. Aluminium prices rose 0.9% or $18.5/MT to $2097.0/MT.
In the Asian session, at GMT0400, the pair is trading at 0.7875, with the AUD trading 0.08% higher against the USD from yesterday's close, after Australia's NAB business conditions index climbed to a record high level of 21.0 in February, thus pointing to robust business activity in the resource-rich nation. The index had recorded a revised reading of 18.00 in the prior month.
On the contrary, the nation's NAB business confidence index declined to a level of 9.0 in February, as a recent global financial market rout weighed on business sentiment. In the previous month, the index had recorded a revised reading of 11.0.
The pair is expected to find support at 0.7858, and a fall through could take it to the next support level of 0.7842. The pair is expected to find its first resistance at 0.7888, and a rise through could take it to the next resistance level of 0.7902.
Moving ahead, traders would keep a close watch on Australia's Westpac consumer confidence index for March, scheduled to release overnight.
The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.
Euro Trading A Tad Higher In The Asian Session
For the 24 hours to 23:00 GMT, the EUR rose 0.11% against the USD and closed at 1.2334.
Macroeconomic data revealed that the US Federal Government recorded a budget deficit of $215.2 billion in February, posting its largest monthly deficit in 6 years, thus suggesting that the impact of the recent tax cuts has begun to surface. In the previous month, the US Government registered a budget surplus of $49.2 billion.
In the Asian session, at GMT0400, the pair is trading at 1.2331, with the EUR trading slightly lower against the USD from yesterday’s close.
The pair is expected to find support at 1.2300, and a fall through could take it to the next support level of 1.2268. The pair is expected to find its first resistance at 1.2354, and a rise through could take it to the next resistance level of 1.2376.
With no macroeconomic releases in the Euro-zone today, investors would direct their attention to the crucial US consumer price inflation data for February, set to release later in the day, to gauge the outlook for inflation.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
UK Chancellor To Present The Spring Budget Today
For the 24 hours to 23:00 GMT, the GBP rose 0.31% against the USD and closed at 1.3903.
In the Asian session, at GMT0400, the pair is trading at 1.3901, with the GBP trading marginally lower against the USD from yesterday’s close.
The pair is expected to find support at 1.3855, and a fall through could take it to the next support level of 1.3810. The pair is expected to find its first resistance at 1.3932, and a rise through could take it to the next resistance level of 1.3964.
UK’s Budget Report is due later today in which the UK Chancellor Philip Hammond will outline the budget for the next fiscal year in addition with providing details on the expected spending and investment plans.
The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.
Japan’s Tertiary Industry Index Sharply Declined In January
For the 24 hours to 23:00 GMT, the USD declined 0.23% against the JPY and closed at 106.36.
In the Asian session, at GMT0400, the pair is trading at 106.56, with the USD trading 0.19% higher against the JPY from yesterday's close.
In economic news, Japan's tertiary industry index registered a drop of 0.6% on a monthly basis in January, more than market expectations for a fall of 0.3%. In the previous month, the index had registered a revised flat reading.
The pair is expected to find support at 106.3, and a fall through could take it to the next support level of 106.05. The pair is expected to find its first resistance at 106.77, and a rise through could take it to the next resistance level of 106.99.
Moving ahead, minutes of the Bank of Japan's January meeting, due to release overnight, will be on investors' radar.
The currency pair is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.
Swiss Franc Extends Its Gains In The Asian Session
For the 24 hours to 23:00 GMT, the USD declined 0.23% against the CHF and closed at 0.9477.
On the economic front, Switzerland’s total sight deposits fell to a level of CHF575.9 billion in the week ended 09 March, compared to a level of CHF576.0 billion reported in the previous week.
In the Asian session, at GMT0400, the pair is trading at 0.9473, with the USD trading slightly lower against the CHF from yesterday’s close.
The pair is expected to find support at 0.9452, and a fall through could take it to the next support level of 0.9430. The pair is expected to find its first resistance at 0.9502, and a rise through could take it to the next resistance level of 0.9530.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
Loonie Trading A Tad Higher, Ahead Of BoC Governor’s Speech
For the 24 hours to 23:00 GMT, the USD rose 0.3% against the CAD and closed at 1.2844.
In the Asian session, at GMT0400, the pair is trading at 1.2842, with the USD trading marginally lower against the CAD from yesterday's close.
The pair is expected to find support at 1.2815, and a fall through could take it to the next support level of 1.2787. The pair is expected to find its first resistance at 1.2858, and a rise through could take it to the next resistance level of 1.2873.
Later in the day, traders would keep a close watch on a speech by the Bank of Canada's (BoC) Governor, Stephen Poloz.
The currency pair is trading above its 20 Hr moving average and showing convergence with its 50 Hr moving average.
Elliott Wave Analysis: USDJPY Correcting In Flat Structure
Short Term Elliott wave View suggests USDJPY is correcting cycle from 2/2 peak (110.5) as an Expanded Flat Elliott Wave Structure. Flat is a corrective Elliott Wave structure with ABC label, and it has a subdivision of 3-3-5. In the case of USDJPY, Minor wave A ended at 197.9 on Feb 21 and Minor wave B ended at 105.23 on March 2.
Up from 105.23, Minor wave C rally is currently in progress as a diagonal 5 waves Elliott Wave structure. Minute wave ((i)) of C ended at 106.46, Minute wave ((ii)) of C ended at 105.43, Minute wave ((iii)) of C ended at 107.05, and Minute wave ((iv)) of C is expected to complete at 105.81 – 106.24 area. Near term, while pullbacks stay above 105.43, expect pair to extend higher towards 107.29 – 107.68 to end Minute wave ((v)) of C. The last push higher in Minute ((v)) of C should also complete Minor wave X and end correction to the cycle from 2/2 peak. Afterwards, pair should resume the decline or at least pullback in 3 waves to correct the 5 waves diagonal rally from 105.23 low.
USDJPY 1 Hour Elliott Wave Chart
