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EUR/USD

Steadied at the 1.0658 low though break of the 1.0700 level see risk for deeper pullback to retrace the 4-wk upleg from 1.0341 low. Lower will see scope to the 1.0620/1.0580 area. Upside seen limited with resistance now at the 1.0711/19 area then the 1.0775 high. [PL]

USD/CHF

Steady in range above the .9960 low though consolidation tracing out a flag pattern and see risk for break lower to trigger further decline to the .9929/00 area then the 200-day MA at .9870. Recent lows at 1.0045 and the 1.0064/87 area now resistance. Would need lift over the latter to fade downside pressure. [PL]

USD/JPY

Extending recovery from the 102.53 low to reach the 115.00 level, lift over this will see further strength to target the 115.62 high of last week. Above the latter will confirm a double bottom at the 112.57/53 lows and trigger stronger recovery to the 116.00 level. Support now at 113.99 then 113.00 level. [PL]

EUR/CHF

Saw sharp drop through the 1.0700 level to take out the 1.0680 low before finding traction at 1.0670 low. Risk now seen for retest of the 1.0624 low of last year to extend the broader decline from 1.0900, Dec high. Resistance now at the 1.0700 level then the 1.0751/62 highs. [PL]

GBP/USD

Spurred by the appearance of a Spinning-top last session, intraday trade a touch softer in consolidation and only deeper break of 1.2490 support to turn current upmove around. Lift above yesterday's high of 1.2673 will see 1.2775 hurdle targeted. [W.T]

EUR/GBP

Follow-through below the .8500 level extending the drop from the .8854 high and see strong support at .8450 now within reach. Below this will see the 200-day MA coming into play at .8409. Failure here will return focus to the .8333 and .8305, Dec lows. [PL]

For the 24 hours to 23:00 GMT, the AUD declined 0.59% against the USD and closed at 0.7525.

LME Copper prices rose 0.4% or $23.0/MT to $5890.0/MT. Aluminium prices declined 0.6% or $11.5/MT to $1837.5/MT.

In the Asian session, at GMT0400, the pair is trading at 0.7532, with the AUD trading 0.09% higher against the USD from yesterday’s close.

The pair is expected to find support at 0.7507, and a fall through could take it to the next support level of 0.7482. The pair is expected to find its first resistance at 0.7567, and a rise through could take it to the next resistance level of 0.7602.

Next week, market participants will concentrate on Australia’s AiG performance of manufacturing and services indices, trade balance, NAB business confidence and building permits data.

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

For the 24 hours to 23:00 GMT, the EUR declined 0.65% against the USD and closed at 1.0677.

On the economic front, Germany’s GfK consumer confidence index rose to a level of 10.2 in February, escalating to a five-month high level, thus reaffirming that household spending will continue to propel growth in the first quarter of 2017. Meanwhile, markets expected for a rise to a level of 10.0, following a level of 9.9 in the previous month.

The US Dollar gained ground against its major peers, after data indicated that the US flash Markit services PMI rose to a level of 55.1 in January, expanding at its fastest pace in 14-months, thus pointing to a robust activity in services sector at the start of 2017. The PMI had registered a reading of 53.9 in the previous month, while market anticipated for an advance to a level of 54.4. Also, the nation’s flash wholesale inventories gained 1.0% on a monthly basis in December, higher than market expectations for an advance of 0.1% and following a similar rise in the prior month. Moreover, the CB leading indicator increased 0.5% in December, above market expectations of 0.2% gain. In the prior month, leading indicator had recorded a revised rise of 0.1%. Meanwhile, the nation’s goods trade deficit narrowed less-than-expected to a level of $65.0 billion in December, amid a pickup in exports and following a deficit of $65.3 billion in the previous month. On the other hand, the nation’s initial jobless claims climbed more-than-expected to a four-week high level of 259.0K in the week ended 21 January 2017, compared to a level of 234.0K in the prior week, while investors were anticipating initial jobless claims to advance to a level of 247.0K. Further, the nation’s new home sales plummeted to a ten-month low level, after it dropped 10.4%, to a level of 536.0K MoM in December, compared to market expectations for it to ease to a level of 588.0K and following a revised reading of 598.0K in the previous month.

In the Asian session, at GMT0400, the pair is trading at 1.0674, with the EUR trading a tad lower against the USD from yesterday’s close.

The pair is expected to find support at 1.0632, and a fall through could take it to the next support level of 1.0590. The pair is expected to find its first resistance at 1.0739, and a rise through could take it to the next resistance level of 1.0804.

Going ahead, investors will look forward to Germany’s import price index for December, scheduled to release in a few hours. Moreover, the US flash annualised GDP for 4Q, durable goods orders for December and final Michigan consumer sentiment index for January, all slated to release later today, will also garner significant amount of market attention.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the GBP declined 0.34% against the USD and closed at 1.2590.

Macroeconomic data indicated that UK's preliminary gross domestic product (GDP) rose more-than-expected by 0.6% on a quarterly basis in 4Q 2016, as higher consumer spending led to robust economic growth in the final quarter of 2016. The GDP recorded a similar rise in the previous quarter, while investors had envisaged the nation's GDP to rise 0.5%. Additionally, the nation's BBA mortgage approvals unexpectedly climbed to a level of 43.2K in December, hitting its highest level in nine-months, compared to a revised reading of 41.0K in the prior month, whereas markets anticipated mortgage approvals to remain unchanged at 41.0K.

Meanwhile, the UK Finance Minister, Philip Hammond, stated that the economy's robust performance in the fourth quarter indicates its fundamental strength. However, he warned that uncertainty may lie ahead as the process of Brexit progresses.

In the Asian session, at GMT0400, the pair is trading at 1.2573, with the GBP trading 0.14% lower against the USD from yesterday's close.

The pair is expected to find support at 1.2527, and a fall through could take it to the next support level of 1.2481. The pair is expected to find its first resistance at 1.2646, and a rise through could take it to the next resistance level of 1.2719.

Going ahead, investors will focus on BoE's interest rate decision along with UK's Markit manufacturing and construction PMIs, consumer confidence, consumer credit and mortgage approvals data, all set to release next week.

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 1.02% against the JPY and closed at 114.48.

In the Asian session, at GMT0400, the pair is trading at 114.97, with the USD trading 0.43% higher from yesterday's close.

Overnight data showed that Japan's national consumer price index (CPI) advanced more-than-expected by 0.3% on an annual basis in December, against market expectations for a rise of 0.2%. In the previous month, the CPI had climbed 0.5%.

The pair is expected to find support at 113.77, and a fall through could take it to the next support level of 112.57. The pair is expected to find its first resistance at 115.6, and a rise through could take it to the next resistance level of 116.23.

Moving ahead, next week traders will closely monitor BoJ's interest rate decision coupled with its meeting minutes. Also, Japan's unemployment rate, industrial production, final Nikkei manufacturing PMI, retail trade, large retailer's sales and consumer confidence data, will also pique investor attention.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD rose 0.08% against the CHF and closed at 0.9997.

Macroeconomic data revealed that Switzerland’s trade surplus narrowed to a level of CHF 2.7 billion in December, following a revised surplus of CHF 3.5 billion in the prior month.

In the Asian session, at GMT0400, the pair is trading at 1.0008, with the USD trading 0.11% higher against the CHF from yesterday’s close.

The pair is expected to find support at 0.9973, and a fall through could take it to the next support level of 0.9937. The pair is expected to find its first resistance at 1.0035, and a rise through could take it to the next resistance level of 1.0061.

Looking ahead, investors would await Switzerland’s real retail sales, KOF leading indicator and SVME-purchasing managers’ index, all scheduled to release next week.

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 0.18% against the CAD and closed at 1.3092.

In economic news, Canada’s CFIB business barometer index declined to a level of 60.1 in January, after recording a reading of 60.7 in the previous month.

In the Asian session, at GMT0400, the pair is trading at 1.3111, with the USD trading 0.15% higher against the CAD from yesterday’s close.

The pair is expected to find support at 1.3065, and a fall through could take it to the next support level of 1.302. The pair is expected to find its first resistance at 1.3143, and a rise through could take it to the next resistance level of 1.3176.

Going ahead, Canada’s GDP and RBC manufacturing PMI, due to release next week, both will be on investor’s radar.

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

Daily Pivots: (S1) 143.20; (P) 143.86; (R1) 144.84; More...

Intraday bias in GBP/JPY remains on the upside as rebound from 136.44 extends today. Corrective fall from 148.42 should have completed at 136.44 already. Further rally should be seen to retest 148.42 first. Break will extend the larger rise from 122.36 and target 150.42 fibonacci level next. n the downside, below 140.74 minor support will turn bias back to the downside for 136.44.

In the bigger picture, price actions from 122.36 medium term bottom are seen as developing into a corrective pattern. Upside is so far limited below 38.2% retracement of 195.86 to 122.36 at 150.42 for setting the medium term range. At this point, we don't expect a break of 122.36 in near term and the corrective pattern would extend for a while. Though, sustained break of 150.42 will target 61.8% retracement at 167.78.

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Daily Pivots: (S1) 121.76; (P) 122.21; (R1) 122.76; More...

Intraday bias in EUR/JPY stays neutral as consolidation from 124.08 extends. Rebound from 109.20 is not finished yet. Break of 124.08 will extend such rise and target 126.09 key resistance next. Meanwhile, below 120.54 will target 118.45 cluster support (38.2% retracement of 109.20 to 124.08 at 118.39). We'd expect strong support from there to contain downside.

In the bigger picture, price actions from 109.20 medium term bottom are seen as part of a medium term corrective pattern from 149.76. There is prospect of another rise towards 126.09 key resistance level before completion. But even in that case, we'd expect strong resistance between 126.09 and 141.04 to limit upside, at least on first attempt. Sustained trading below 55 day EMA will pave the way to retest 109.20.

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Daily Pivots: (S1) 0.8456; (P) 0.8495; (R1) 0.8519; More...

EUR/GBP's recovery from 0.8303 has likely finished at 0.8851 already. Break of 0.8449 support will confirm this case and target 0.8303. Break will extend the whole corrective fall from 0.9304 and target 0.8116 support. In case of another rise, we'd now expect strong resistance at 61.8% retracement of 0.9304 to 0.8303 at 0.8922 to limit upside and bring near term reversal.

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).

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