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For the 24 hours to 23:00 GMT, the USD declined 0.22% against the JPY and closed at 114.68.

In the Asian session, at GMT0400, the pair is trading at 114.83, with the USD trading 0.13% higher against the JPY from yesterday's close.

Earlier today, data showed that Japan's final industrial production fell 0.4% MoM in January, compared to a fall of 0.8% in the flash estimate and following a rise of 0.7% in the previous month.

The pair is expected to find support at 114.48, and a fall through could take it to the next support level of 114.14. The pair is expected to find its first resistance at 115.18, and a rise through could take it to the next resistance level of 115.54.

Looking ahead, market participants await the Bank of Japan's interest rate decision, scheduled in the early hours tomorrow. Markets broadly expect the central bank to keep the monetary policy unchanged.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD rose 0.21% against the CHF and closed at 1.0093.

In the Asian session, at GMT0400, the pair is trading at 1.0092, with the USD trading marginally lower against the CHF from yesterday’s close.

The pair is expected to find support at 1.0069, and a fall through could take it to the next support level of 1.0046. The pair is expected to find its first resistance at 1.0111, and a rise through could take it to the next resistance level of 1.0130.

Market participants look forward to Switzerland’s producer and import prices data for February, due in a few hours.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average

For the 24 hours to 23:00 GMT, the USD rose 0.22% against the CAD and closed at 1.3480.

In the Asian session, at GMT0400, the pair is trading at 1.3467, with the USD trading 0.1% lower against the CAD from yesterday's close.

The pair is expected to find support at 1.3438, and a fall through could take it to the next support level of 1.3409. The pair is expected to find its first resistance at 1.3495, and a rise through could take it to the next resistance level of 1.3523.

Ahead in the day, investors will keep a close watch on Canada's existing home sales data for February.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

Short term Elliott Wave view in EURJPY suggests that the pair has ended the cycle from 2/24 low (118.18) and the instrument is pulling back to correct that cycle before turning higher again. Primary wave ((5)) is currently in progress higher and the rally from Primary wave ((4)) low at 118.18 is unfolding as an ending diagonal Elliott wave structure where Intermediate wave (1) ended at 122.88. The subdivision of Intermediate wave (2) pullback is proposed to be in a double three Elliottwave structure where Minor wave W ended at 121.59 and Minor wave X bounce is in progress.

The subwaves of Minor W looks to be in a zigzag Elliott wave structure, and if the subwaves of Minor Y later also takes the form of a zigzag, then this is a special structure of a double three where the subwave of both wave W and Y unfolds as a zigzag and we can call this structure a double zigzag. Near term, while Minor wave X bounce fails below 122.88 high, pair should turn lower in Minor wave Y of (2) towards 119.97 – 120.53 area before pair resumes the rally higher, provided that pivot at 118.18 low stays intact. We don’t like selling the proposed pullback and expect buyers to appear at above area for at least 3 waves bounce.

EURJPY 1 Hour Chart

Key Points:

• Markets strongly pricing in the risk of a rate hike from the Fed.
• Dollar bulls may be disappointed as Fed likely to be cautious on forward guidance.
• Watch for sharp volatility during the FOMC risk event.

The New Zealand Dollar is bracing itself ahead of the U.S. Fed's FOMC decision but the pair currently remains on a recovery trajectory. In particular, the daily pivot point has proved decisive in containing any further declines and price action has subsequently held around the 0.6931 mark. However, despite a solid NZ current account result of -2.335bn the pair is still at risk from potential FOMC volatility.

The looming Fed interest rate decision poses a sharp risk event to the embattled Kiwi Dollar given the current level of uncertainty over the central bank's medium term direction. Most of the economic forecasts that are floating around seem to suggest that the central bank will hold rates steady at 0.75% during tomorrow's meeting. However, this stands in stark contrast to Bloomberg's survey showing that out of 83 professional economists, only 3 believe that the Fed will hold steady.

Subsequently, there has been a steady pricing in of the risk of a 25bps rate hike, especially given the veritable public relations assault that various FOMC members have been undertaking recently. The central bank has literally done all they can to alter expectations for a rate hike in the lead up to this event. This primarily suggests that Dollar longs will be looking for, not just a rate hike, but some strong signals of a cycle of tightening.

However, given the Fed's predilection for caution, the likely scenario is a 25bps rate hike to the FFR and then a subsequent return to the central bank's key mantra of remaining data dependant. This is unlikely to be enough to satiate the bulls given the current spread of long positions in play. Subsequently, there is a very real risk of market disappointment despite the likely decision to announce a 25bps hike. So don't at all be surprised if the various cross pairs actually rise against the greenback on the day.

Ultimately, the NZDUSD is likely to be volatile, in the lead up to the decision, but rely upon a few key technical levels. In particular, keep a close watch on resistance at 0.6990 as, if there is a disappointing Fed announcement, this will be the key level the pair will need to surmount to cement a move to the upside. On the downside, watch the support zone around 0.6895 as this is the bottom of the recent decline and is also close to the pivot point.

Key Points:

• Near-term downsides are looking likely.
• Long-term head and shoulders could be shaping up.
• Keep an eye on the FOMC meeting.

Despite a slowing rate of decline, gold could have further downsides on offer moving ahead. Specifically, the shift in the metal's technical bias should see it back at around the 1180.00 handle within the next week or so. However, these losses could be hinting at the formation of a long-term chart pattern which might lead to a rather tumultuous future for gold prices.

However, before we get into the long-term forecast, let's take a look at some of the technical arguments for further losses moving forward. For one, the EMA bias provides what could be the clearest indication of further downsides, largely as a result of the recent bearish crossover of the 12, 20, and 100 day moving averages. Additionally, the Parabolic SAR retains a firm bearish bias which should keep selling pressure in place.

If the metal does pull back as forecasted, this could hint at the presence of a long term head and shoulders pattern. If such a pattern is indeed present, this could mean that we see a rally in the immediate aftermath of the coming tumble. This uptick in buying pressure will likely bring gold prices back up to the 1219.34 mark before resistance kicks in. Conveniently, the presence of the 50.0% Fibonacci level and the 100 day EMA around this price will be instrumental in encouraging the right hand shoulder retrace as visualised above.

In the event that this second shoulder forms and confirms the long-term structure, downside risks for gold will spike considerably. In fact, we could have December's low tested once again before we see any meaningful support come into effect. However, it will be worthwhile waiting for that 78.6% Fibonacci level to be broken before pricing in a slip all the way back to the 1128.21 level.

From a fundamental perspective, it's a fairly safe bet to assume gold prices are long-term bullish. Of course, this is a direct result of the US Fed's plan to tighten monetary policy significantly moving ahead. The main uncertainty is exactly when the Fed chooses to begin tightening which is especially pertinent this week given the impending FOMC meeting. However, if we don't see the much talked about hike this week, it will basically assure one for the next meeting which would work well with the above technical forecast.

Ultimately, keep an eye on the metal as it sure to be in focus over the coming weeks. As discussed above, this could see some interesting moves for gold prices which offers much in the way of trading opportunities for both the bulls and the bears out there. Additionally, whilst the FOMC will be one of the major drivers of price, don't forget to keep an eye on political risks in the EU and the standard US economic news.

A note on lower timeframe confirming price action...

Waiting for lower timeframe confirmation is our main tool to confirm strength within higher timeframe zones, and has really been the key to our trading success. It takes a little time to understand the subtle nuances, however, as each trade is never the same, but once you master the rhythm so to speak, you will be saved from countless unnecessary losing trades. The following is a list of what we look for:

• A break/retest of supply or demand dependent on which way you're trading.
• A trendline break/retest.
• Buying/selling tails ... essentially we look for a cluster of very obvious spikes off of lower timeframe support and resistance levels within the higher timeframe zone.
• Candlestick patterns. We tend to only stick with pin bars and engulfing bars as these have proven to be the most effective.

EUR/USD

The EUR sustained further losses against its US counterpart during the course of yesterday's sessions, consequently bringing the pair down as far as the 1.06 handle into the closing bell. US PPI data came in hotter than expected, but failed to generate much of a reaction. Although1.06 boasts little higher-timeframe structure; it does merge closely with the 50.0% retracement value at 1.0603. Furthermore, the pair is likely to find some support around 1.06ish region with it having been a strong barrier of resistance on a number of occasions over the past few weeks (see green circle).

Our suggestions: With little higher-timeframe structure seen supporting the 1.06 zone, it's still a risky buy from here, in our opinion. As a result of this, we would strongly recommend waiting for a lower-timeframe confirming buy signal (see the top of this report) to form before considering a position. The first take-profit target is set at the nearby H4 resistance area coming in at 1.0636-1.0628.

In addition to the technicals, the much anticipated FOMC rate decision, economic projections and press conference is finally upon us today. According to the CME's FedWatch tool, there's over a 90% chance that we'll see an increase of 25bps. Therefore, remain alert during this time!

Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.

Levels to watch/live orders:

• Buys: 1.06 neighborhood ([waiting for a lower-timeframe confirming signal to form is advised] stop loss: dependent on where one confirms this level).
• Sells: Flat (stop loss: N/A).

GBP/USD

Weekly action is currently seen defending the underside of a recently broken weekly Quasimodo line coming in at 1.22. On the condition that the pair remains bearish beyond this hurdle, then the next port of call on this scale can be seen around weekly support coming in at 1.1904. Looking down to the daily timeframe, yesterday's candle tested daily support drawn from 1.2135/ the daily 161.8% Fib ext. at 1.2119 taken from the high 1.2706, consequently erasing all of Monday's gains!

Over on the H4 candles, we can see that the major plummeted lower going into the early hours of Europe yesterday, taking out both the 1.22 handle and the H4 mid-way support at 1.2150. Nevertheless, during the London morning segment, price did manage to bottom just ahead of the 1.21 handle and break back above the 1.2150 vicinity into the US open.

Our suggestions: Although the market does sport a rather bearish vibe right now, traders are in somewhat of a precarious position according to technical structure. A sell trade looks fantastic from the weekly timeframe, but at the same time, a potentially terrible idea on the daily timeframe. A buy trade on the other hand, appears sound from the daily timeframe, but risky from a weekly perspective.

With the much anticipated FOMC rate decision, economic projections and press conference upon us today, and UK employment data just around the corner, we feel opting to stand on the sidelines may very well be the better path to take. At least until the FOMC have had their way!

Data points to consider: UK employment report at 9.30am. US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Flat (stop loss: N/A).

AUD/USD

After the pair broke beyond the H4 mid-way support hurdle at 0.7550 during the early hours of Monday's segment, price has remained somewhat directionless between 0.7550 and the overhead February opening level at 0.7577. Over on the weekly scale the weekly support area continues to buoy price, which could eventually prompt an approach up to the weekly trendline resistance extended from the high 0.8163. On the other side of the field, however, daily price is seen tickling the underside of a daily supply zone at 0.7632-0.7584. In order for weekly price to advance, this daily zone will have to be taken out. Of particular interest here is the daily supply at 0.7699-0.7656 seen above the current zone, given that it intersects with the aforementioned weekly trendline resistance.

Our suggestions: There is very little telling us to get involved with this market at the moment. While a break above February's opening base would be considered a bullish signal according to the weekly timeframe, we would be wary of buying here owing to the next upside target sitting at 0.76, and also the fact that price would still be trading within daily supply!

Our team feels that in light of the slightly restricted price action currently in view, the best position to take here is no position at all.

Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Flat (stop loss: N/A).

USD/JPY

During the course of yesterday's sessions the USD/JPY aggressively whipsawed through the 115 handle, tapped the underside of a nearby H4 supply zone at 115.37-115.18, and proceeded to selloff going into the London segment. With the H4 candles now currently finding support just ahead of the H4 mid-way number 114.50, where do we go from here? Well, according to the weekly timeframe, price remains on course to cross swords with a weekly resistance level seen at 116.08. Despite this, the daily candles are persistently holding ground within the walls of a daily resistance area coming in at 115.62-114.60.

Our suggestions: Based on the above notes, our team has their eye on the H4 113.84/114.20 (AB=CD H4 Fib ext. 127.2/161.8%) neighborhood for longs. Granted this does entail entering long just below the current daily resistance area, but what with weekly price suggesting further buying could be on the cards and the confluence (H4 trendline support extended from the high 115.62, 114 handle and H4 AB=CD approach [black arrows]) seen around 113.84/114.20, a bounce north from here is considered high probability, in our opinion. Be that as it may, we would not advise trading this zone around FOMC time today, as volatility is expected to be high.

Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.

Levels to watch/live orders:

• Buys: 113.84/114.20 ([waiting for a lower-timeframe confirming signal to form is advised – this will help avoid a fakeout down to the nearby H4 demand at 113.47-113.70] stop loss: dependent on where one confirms this level).
• Sells: Flat (stop loss: N/A).

USD/CAD

Recent action shows that the USD/CAD extended its bounce from the 1.3419/1.3434 H4 region (November/December/January's opening levels), lifting price up to within striking distance of the 1.35 handle. As you can see, the H4 candles have held ground within a H4 AB=CD Fib ext. 161.8%/127.2% area at 1.3507/1.3488 (taken from the low 1.3420) and is selling off as we write. This was a nice reversal zone. The thing that turned us off, however, was the fact that H4 momentum is still pointing to the upside and daily price had recently bounced from the top edge of a daily demand area chalked in at 1.3371-1.3437. The flipside to this, of course, is the weekly timeframe. The unit managed to marginally close beyond the 2017 yearly opening level at 1.3434. But since the close above this line was relatively minor, and taking into account that there is a nearby weekly double-top formation seen around the 1.3588 region (green circle), we do not consider 1.3434 to be out of the picture as a weekly resistance just yet!

Our suggestions: In view of the conflict seen between the higher-timeframe structures at the moment, we are wary of attempting to try and sell right now, despite the beautiful H4 AB=CD setup in play! And as for buying, this is also something we would not be comfortable taking part in, owing to the weekly structure mentioned above. With this in mind, opting to stand on the sidelines here may very well be the better path to take today.

Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm. Crude oil inventories at 2.30pm GMT.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Flat (stop loss: N/A).

USD/CHF:  

Try as it might, the Swissy could not muster enough strength to breach March's opening level at 1.0066. As highlighted in Monday's report, this number is bolstered by a H4 trendline support taken from the low 0.9929 and a H4 127.2% Fib ext. at 1.0071 (taken from the high 1.0160). As we write, nevertheless, the nearby 1.01 handle is providing resistance to this market. Whether or not this will be enough to push the unit back down to the 1.0066 perimeter is difficult to judge, since there is no higher-timeframe structures positioned nearby these levels.

Looking up to the weekly picture, price is seen trading mid-range between the 2017/2016 yearly opening levels at 1.0175/1.0029. By the same token, daily action is also currently seen trading mid-range between daily supply at 1.0248-1.0168 and daily demand pegged at 0.9929-0.9975, which happens to intersect with a daily support level seen at 0.9950.

Our suggestions: A break above 1.01 boasts little room for maneuver with H4 resistance seen at 1.0135. A break below 1.0066 on the other hand may call for price to challenge the H4 Quasimodo support at 1.0024, followed closely by parity (1.0000). To that end, we feel there's a possibility for shorts beyond 1.0066 today if a retest of this number as resistance is seen that's bolstered by a lower-timeframe sell signal (see the top of this report). However, do remain vigilant today since we have the much anticipated FOMC rate decision, economic projections and press conference just around the corner.

Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm. CHF PPI data at 8.15am GMT.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Watch for price to engulf 1.0066 and then look to trade any retest seen thereafter (waiting for a lower-timeframe confirming signal to form following the retest is advised] stop loss: dependent on where one confirms the level).

DOW 30

As can be seen from the H4 chart this morning, the DOW momentarily surpassed March's opening level at 20824, bounced off a H4 AB=CD 127.2% Fib ext. at 20787 (seen lodged within a H4 demand at 20769-20801), and ended the day closing at 20844. What this move also accomplished was a relatively nice-looking daily buying tail printed from the top edge of a daily demand zone seen at 20714-20821.

With equities still trading nearby record highs, there's a good chance that this unit could stretch higher today and potentially even break through H4 supply at 20951-20911. Should price retest March's opening base line sometime today, we would consider a long in this market on the condition that a reasonably sized H4 bullish rotation candle is seen. However, do remain vigilant today since we have the much anticipated FOMC rate decision, economic projections and press conference just around the corner.

Our suggestions: Watch for potential longs off the 20824 barrier today. In the event that one manages to pin down a setup from here, we'd look to trail the position up to the aforementioned H4 supply, followed closely by the 21000 mark.

Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.

Levels to watch/live orders:

• Buys: 20824 region ([waiting for a reasonably sized H4 bull candle to form here before pulling the trigger is advised] stop loss: ideally beyond the trigger candle).
• Sells: Flat (stop loss: N/A).

GOLD  

Following the daily bearish selling wick printed on Monday, we saw the yellow metal take a hit during yesterday's trading, bringing price back to the top edge of the daily support area at 1197.4-1187.7. What is also quite notable from a technical perspective is the H4 bullish AB=CD 127.2% pattern that completed within the walls of a H4 demand zone drawn from 1194.8-1198.3. As we can all see, price is rallying from this base. How far price will advance from here is, well, anybody's guess. The reason we say this is simply due to the weekly timeframe indicating that price could potentially continue driving lower until we reach the weekly support level drawn from 1180.1.

Our suggestions: While there is some conflict seen between the higher timeframes at the moment, there's a good chance that H4 flow will reach the 1204.0 region before stalling. Well done to any of our readers who managed to get long from the tip of the H4 AB=CD formation!

Unless the H4 candles retest the current H4 demand sometime today (at this point we would consider entering long from here assuming that we have the backing of a lower-timeframe buy signal [see the top of this report]), we will remain flat until after today's FOMC event.

Levels to watch/live orders:

• Buys: 1194.8-1198.3 ([waiting for a lower-timeframe confirming signal to form is advised prior to pulling the trigger here] stop loss: dependent on where one confirms this area).
• Sells: Flat (stop loss: N/A).

Daily Pivots: (S1) 121.34; (P) 121.98; (R1) 122.31; More...

Intraday bias in EUR/JPY remains neutral as consolidation from 122.88 temporary top continues. Deeper retreat cannot be ruled out but downside should be contained by 121.18 resistance turned support and bring another rally. Above 122.88 will target 124.08. Decisive break there will extend larger rise from 109.20 and target 126.09 key resistance next.

In the bigger picture, current development suggests that medium term rise from 109.20 is still in progress. Focus is now on 126.09 key resistance level. Sustained break will confirm completion of the whole decline from 149.76. And rise from 109.20 is of the same degree as the fall from 149.76. In such case, further rally would be seen to 104.04 resistance and possibly above before topping. Meanwhile, rejection from 126.09 will extend the fall from 149.76 through 109.209 low.

Daily Pivots: (S1) 138.91; (P) 139.67; (R1) 140.19; More...

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In the bigger picture, price actions from 122.36 medium term bottom are still seen as a corrective pattern. Main focus is on 38.2% retracement of 195.86 to 122.36 at 150.42. Rejection from there will turn the cross into medium term sideway pattern with a test on 122.36 low next. Though, sustained break of 150.42 will extend the rebound towards 61.8% retracement at 167.78.

Daily Pivots: (S1) 0.8697; (P) 0.8741; (R1) 0.8768; More...

EUR/GBP is still bounded in consolidation below 0.8786 and intraday bias remains neutral for the moment. Another fall could be seen as the consolidation extends. But downside should be contained by 38.2% retracement of 0.8402 to 0.8786 at 38.2% retracement of 0.8402 to 0.8786 at 0.8639 and bring another rise. Above 0.8786 will target 0.8851 resistance and above. However, price actions from 0.8303 are seen as the second leg of the corrective pattern from 0.9304. Hence, we'd expect strong resistance from 100% projection of 0.8303 to 0.8851 from 0.8402 at 0.8950 to limit upside.

In the bigger picture, price actions from 0.9304 are viewed as a medium term corrective pattern. Deeper fall cannot be ruled out yet. 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. Overall, the corrective pattern would take some time to complete before long term up trend resumes at a later stage. Break of 0.9304 will pave the way to 0.9799 (2008 high).