Daily Outlook

December 29, 2015

Trading since Monday has been thin due to holiday market closures. This is another quiet week with few headline evets (all times are GMT):

1. US: Advance Goods Trade Balance (Tuesday 13:30), Pending home sales MoM (Wednesday 15:00), Chicago PMI (Thursday 14:45)

2. UK: Nationwide House prices MoM (Wednesday 07:00)

3. JP: Industrial production MoM (Sunday 23:50)

EUR continues to find solid support on dips with strength coming from post Fed hike profit taking on USD longs and end-of-year repositioning in thin trade.

GBP has been showing few lower top defining a very well downtrend off the 2015 high in June. Market now sees a more dovish BOE and shifted its rate hike expectations to 2017. Profit taking on USD and OIL bounce contributes to some recovery off recent lows.

Japanese market are one of the few markets open in holiday trade. With the Yen selling off on the back of a weaker round of data out of Japan, it has given an excuse to buy back some USD for few market participants.

Commodities prices has been recovering recently, which helps to support AUD into a latest rally.

Given the struggling global and uncertainty in the air, gold is finding formidable supporting into the latest dip despite Feb hike favoring USD.

Currency Updates:

EUR/USD Intraday: the upside prevails

Pivot: 1.094

Our preference: long positions above 1.094 with targets @ 1.101 & 1.103 in extension.

Alternative scenario: below 1.094 look for further downside with 1.09 & 1.0865 as targets.

Comment: the RSI is mixed to bullish.

Supports and resistances:
1.106 ***
1.103 **
1.101 **
1.0972 Last
1.094 ***
1.09 *
1.0865 **

USD/JPY Intraday: under pressure

Pivot: 120.75

Our preference: short positions below 120.75 with targets @ 120 & 119.8 in extension.

Alternative scenario: above 120.75 look for further upside with 121 & 121.3 as targets.

Comment: as long as 120.75 is resistance, look for choppy price action with a bearish bias.

Supports and resistances:
121.3 **
121 **
120.75 ***
120.36 Last
120 *
119.8 **
119.4 ***

GBP/USD Intraday: the downside prevails

Pivot: 1.493

Our preference: short positions below 1.493 with targets @ 1.4855 & 1.483 in extension.

Alternative scenario: above 1.493 look for further upside with 1.4985 & 1.502 as targets.

Comment: a break below 1.4855 would trigger a drop towards 1.483.

Supports and resistances:
1.502 **
1.4985 ***
1.493 **
1.488 Last
1.4855 ***
1.483 **
1.4805 **

AUD/USD Intraday: bullish bias above 0.724

Pivot: 0.724

Our preference: long positions above 0.724 with targets @ 0.7285 & 0.7315 in extension.

Alternative scenario: below 0.724 look for further downside with 0.7205 & 0.718 as targets.

Comment: a support base at 0.724 has formed and has allowed for a temporary stabilisation.

Supports and resistances:
0.7335 *
0.7315 **
0.7285 ***
0.7252 Last
0.724 ***
0.7205 ***
0.718 **

SPI 200‏ (ASX)‏ (H6) Intraday: further advance

Pivot: 5140

Our preference: long positions above 5140 with targets @ 5230 & 5295 in extension.

Alternative scenario: below 5140 look for further downside with 5085 & 5040 as targets.

Comment: the RSI advocates for further upside.

Supports and resistances:
5345
5295
5230
5197 Last
5140
5085
5040

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