Sample Category Title

Daily Pivots: (S1) 0.9148; (P) 0.9164; (R1) 0.9190; More....

Intraday bias in USD/CHF remains neutral as it's still staying in consolidation from 0.9090. On the downside, firm break of 0.9084 support will argue that choppy rise from 0.8925 has completed. Fall from 0.9471 might be ready to resuming. Further decline would be seen back to 0.8925 support first. On the upside, above 0.9276 will target 0.9372 resistance instead.

In the bigger picture, the corrective structure of the rebound from 0.8925 argues that fall from 0.9471 is not complete yet. It could either be the second leg of pattern from 0.8756 (2021 low), or resuming larger down trend from 1.0237 (2018 high). We'd pay attention to the downside momentum and assess the odds later. But for now, medium term outlook will be neutral at best as long as 0.9471 resistance holds.

Daily Pivots: (S1) 113.89; (P) 114.22; (R1) 114.47; More...

Intraday bias in USD/JPY remains on the downside at this point. Break of 113.47 will resume the fall from 112.52 structural support. Considering bearish divergence condition in in daily MACD, further break of 112.52 will confirm that it's already in correction to the up trend from 102.58. Deeper decline would be seen to 38.2% retracement of 102.58 to 116.34 at 111.08. For now, risk will stay on the downside as long as 115.05 resistance holds, in case of recovery.

In the bigger picture, no change in the view that rise from 102.58 is the third leg of the up trend from 101.18 (2020 low). Such rally should target a test on 118.65 (2016 high). Sustained break there will pave the way to 120.85 (2015 high) and raise the chance of long term up trend resumption. However, firm break of 112.52 support will dampen this bullish case and we'll assess the outlook based on subsequent price actions later.

Daily Pivots: (S1) 0.7198; (P) 0.7237; (R1) 0.7266; More...

Intraday bias in AUD/USD remains neutral at this point as range trading continues. We're still slightly favoring the case that correction from 0.8006 is complete after defending 0.6991. Above 0.7313 will extend the rise from 0.6992 to 0.7555 resistance. However, break of 0.7128 support will dampen this bullish case and bring retest of 0.6991/2 instead.

In the bigger picture, strong rebound from 0.6991 key structural support will retain medium term bullishness. That is, whole up trend from 0.5506 is still in progress. Firm break of 0.7555 resistance will target 0.8006 high and above. However, sustained break of 0.6991 will argue that the whole up trend from 0.5506 might be finished at 0.8006, after rejection by 0.8135 long term resistance. Deeper decline would then be seen back to 61.8% retracement of 0.5506 to 0.8006 at 0.6461.

Daily Pivots: (S1) 1.2464; (P) 1.2491; (R1) 1.2528; More...

Downside momentum is diminishing in USD/CAD as seen in 4 hour MACD. But with 1.2569 resistance intact, further decline is still expected. As noted before, the whole pattern from 1.2005 might be finished three waves to 1.2963. Further fall would be seen to 1.2286 support, possibly further to retest 1.2005 low. Nevertheless, on the upside, break of 1.2569 minor resistance will indicate short term bottoming and turn bias back to the upside for stronger rebound.

In the bigger picture, focus will be on 38.2% retracement of 1.4667 (2020 high) to 1.2005 (2021 low) at 1.3022. Sustained break there should confirm that the down trend from 1.4667 has completed after defending 1.2061 long term cluster support. Further rise would then be seen towards 61.8% retracement at 1.3650. However, rejection by 1.3022 will maintain medium term bearishness. Break of 1.2005 will resume the down trend form 1.4667 and that carries larger bearish implications too.

Daily Pivots: (S1) 1.0366; (P) 1.0381; (R1) 1.0389; More....

Intraday bias in EUR/CHF remains on the downside as fall from 1.0510 is in progress for 1.0324 low. Firm break there will resume larger down trend from 1.1149, and target 161.8% projection of 1.1149 to 1.0694 from 1.0936 at 1.0200 next. On the upside, above 1.0417 minor resistance will extend the corrective pattern with another rise leg. But upside should be limited by 38.2% retracement of 1.0936 to 1.0324 at 1.0558.

In the bigger picture, long term down trend from 1.2004 (2018 high) is now extending. Next target is 61.8% projection of 1.2004 to 1.0505 to 1.1149 at 1.0223. On the upside, firm break of 1.0505 support turned resistance is needed to be the first sign of medium term bottoming. Otherwise, outlook will remain bearish even in case of rebound.

Daily Pivots: (S1) 0.8302; (P) 0.8321; (R1) 0.8336; More...

EUR/GBP is losing downside momentum as seen in 4 hour MACD. But after all, outlook stays bearish with 0.8377 resistance intact. Current down trend should continue to 0.8276 key long term support. On the upside, however, break of 0.8377 resistance will now indicate short term bottoming, and bias back to the upside for stronger rebound.

In the bigger picture, price actions from 0.9499 (2020 high) are still seen as developing into a corrective pattern. Deeper fall could be seen as long as 0.8598 resistance holds, towards long term support at 0.8276. We'd look for bottoming signal around there to bring reversal. Meanwhile, firm break of 0.8598 will now be an early sign of medium term bottoming and bring stronger rebound. However, sustained break of 0.8276 will argue that the long term trend has reversed.

Daily Pivots: (S1) 1.5581; (P) 1.5660; (R1) 1.5732; More...

Much volatility is seen in EUR/AUD but it's staying in established range after all. Intraday bias remains neutral for the moment. On the downside, break of 1.5559 will resume the fall from 1.6168 to retest 1.5250/5354 support zone. On the upside, however, break of 1.5898 will argue that pull back from 1.6168 has completed. Intraday bias will be back to the upside for 1.6168 resistance.

In the bigger picture, rise from 1.5354 is seen as the third leg of the corrective pattern from 1.5250 low. Further rise cannot be ruled out, but even in that case, strong resistance should be seen at 38.2% retracement of 1.9799 to 1.5250 at 1.6988. Larger down trend from 1.9799 is in favor to extend through 1.5250 at a later stage.

Daily Pivots: (S1) 128.73; (P) 129.41; (R1) 129.77; More....

Intraday bias in EUR/JPY stays on the downside for the moment. Fall from 131.59 is seen as part of the corrective pattern from 134.11. Deeper decline would be seen to 127.36 support first. Break will target 126.58 fibonacci level. On the upside, above 130.07 minor resistance will turn intraday bias neutral first. But risk will stay on the downside for now as long as 131.59 resistance holds.

In the bigger picture, as long as 38.2% retracement of 114.42 (2020 low) to 134.11 at 126.58 holds, up trend from 114.42 is still in favor to continue. Break of 134.11 will target long term resistance at 137.49 (2018 high). However, sustained break of 126.58 will raise the chance of medium term bearish reversal. In this case, deeper decline would be seen to 61.8% retracement at 121.94, and possibly below.

Daily Pivots: (S1) 154.88; (P) 155.47; (R1) 155.80; More...

GBP/JPY's break of 154.85 support argues that rebound from 148.94 has completed at 157.74, ahead of 158.19 high. Fall from 157.74 is seen as the third leg of the consolidative pattern from 158.19. Intraday bias is back on the downside. Sustained break of 55 day EMA (now at 154.11) will target 148.94 support next. For now, risk will stay on the downside as long as 157.74 resistance holds, in case of recovery.

In the bigger picture, strong rebound from 148.93 key structural support retains medium term bullishness. Firm break of 158.19 high will resume whole up trend from 123.94 (2020 low), to 61.8% retracement of 195.86 to 122.75 at 167.93. Nevertheless, firm break of 148.93 will bring deeper correction to 38.2% retracement of 123.94 to 158.19 at 145.10, and possibly further lower, as a correction to up trend from 123.94 at least.

Yen is regaining strength in Asian session today and sentiment turned risk-off again. In particular, selloff is particularly apparent in cryptocurrencies. Swiss Franc, Euro and Dollar are all ticking up slightly. On the other commodity currencies are under some pressure, with Aussie leading the way down. For the week, Yen is currently the best performer, followed by Canadian Dollar. Kiwi is the worst, followed by Euro.

Technically, GBP/JPY's break of 154.86 support now suggests that rise from 148.94 has completed at 157.74, ahead of 158.19 resistance. Deeper decline is now in favor back to 152.60 resistance turned support and possibly below. One focus is now on when USD/JPY would break through 113.47 support to resume the decline from 116.34, to solidify near term bullishness in Yen.

In Asia, Nikkei closed down -0.84%. Hong Kong HSI is down -0.67%. China Shanghai SSE is down -0.80%. Singapore Strait Times is down -0.14%. Japan 10-year JGB yield is down -0.0088 at -0.136. Overnight, DOW dropped -0.89%. S&P 500 dropped -1.10%. NASDAQ dropped -1.30%. 10-year yield rose 0.006 to 1.833.

Japan CPI core unchanged at 0.5% yoy in Dec

Japan CPI core (all item ex-food) was unchanged at 0.5% yoy in December, below expectation of 0.6% yoy. But that's still the second increase in a row, and the fastest pace in nearly two years. All item CPI accelerated from 0.6% yoy to 0.8% yoy. All item ex-food, ex-energy CPI dropped from -0.6% yoy to -0.7% yoy.

In the minutes of December BoJ meeting, a board member said, "we're seeing signs of change in the price-setting behavior of Japanese firms, which had been said to be cautious about raising prices for fear of seeing sales volume fall,."

Another member noted, "it's unlikely Japan will see wages rise as sharply as in the United States. But there's a significant chance both economic growth and inflation could overshoot expectations,"

Earlier this week, BoJ raised 2022 and 2023 core CPI projection. But it also indicated there is no rush to change the ultra-loose monetary policy.

New Zealand BusinessNZ PMI rose to 53.7, return to growth

New Zealand BusinessNZ Performance of Manufacturing Index rose from 51.2 to 53.7 in December. Looking at some details, Production rose from 53.0 to 56.3. Employment rose from 48.5 to 52.0. New orders rose from 55.4 to 57.5. Finished stocks rose from 48.7 to 52.0. Deliveries rose from 43.9 to 50.0.

BNZ Senior Economist, Doug Steel stated that "in the final quarter of 2021 the PMI averaged 53.2, indicating a return to positive manufacturing GDP growth after a sharp negative in the prior quarter."

Bitcoin breaks 40k, Ethereum breaks 3k, as selloff resumes

Bitcoin breaks down through 39636 temporary support today, after another rejection by 4 hour 55 EMA. Down trend from 68986 resumes and should now target 61.8% projection of 68986 to 41908 from 52101 at 35366. For now, such decline is seen as part of a long term range pattern between 29261 and 68986 only. Hence, momentum to start to diminish below 35366, and a bottom should be formed above 29261 low. Nevertheless, break of 44448 resistance is needed to indicate bottoming, or risk will stay heavily on the downside.

Ethereum also resumes recent fall from 4863.75 by breaking through 2927.20 today. Next target is 100% projection of 4863.75 to 3439.00 from 4126.20 at 2701.45, which is close to 2647.30 support. Downside momentum should start to diminish below this level. The question is where between 1715.62/2647.30 would ethereum forms a bottom. But in any case, break of 3411.05 is needed to indicate bottoming first, or risk will stay heavily on the downside. The fall from 4863.75 could eventually extend to 161.8% projection at 1820.95, which is close at 1715.62 low, become finishing.

Looking ahead

UK retail sales is the main feature in European session. Later in the day, Canada will also release retail sales, and new housing price index.

GBP/JPY Daily Outlook

Daily Pivots: (S1) 154.88; (P) 155.47; (R1) 155.80; More...

GBP/JPY's break of 154.85 support argues that rebound from 148.94 has completed at 157.74, ahead of 158.19 high. Fall from 157.74 is seen as the third leg of the consolidative pattern from 158.19. Intraday bias is back on the downside. Sustained break of 55 day EMA (now at 154.11) will target 148.94 support next. For now, risk will stay on the downside as long as 157.74 resistance holds, in case of recovery.

In the bigger picture, strong rebound from 148.93 key structural support retains medium term bullishness. Firm break of 158.19 high will resume whole up trend from 123.94 (2020 low), to 61.8% retracement of 195.86 to 122.75 at 167.93. Nevertheless, firm break of 148.93 will bring deeper correction to 38.2% retracement of 123.94 to 158.19 at 145.10, and possibly further lower, as a correction to up trend from 123.94 at least.

Economic Indicators Update