The market has been shaky since the start of 2016. Wednesday just experienced added pressure with another round of discouraging news, e.g. further yuan, more soft data released from China, global stocks were kicked around and oil fell nearly 6%. Following with the upgraded tension between Saudi Arabia and Iran, a surprising hydrogen bomb in North Korea further triggered risk-averse price action.
Overnight, dollar stays firm in early US session as ADP job beat expectation. Later on the FOMC minutes showed that the rate hike was a much closer call than the market had been expecting. The minutes was considered a litter dovish as Fed member had “significant concern” about inflation level. However, BNP commented that “Inflation data ahead of FOMC’s March meeting is unlikely to increase worries and/or uncertainty about inflation failing to return to target”. They suggest that there is an 80% chance of another rate hike in March.
Overall, the forex market is focusing more on China, emerging market growth and geopolitics.
Currency Updates:
EUR/USD Intraday: key resistance at 1.08
Pivot: 1.08
Our preference: short positions below 1.08 with targets @ 1.0705 & 1.067 in extension.
Alternative scenario: above 1.08 look for further upside with 1.084 & 1.0885 as targets.
Comment: the upward potential is likely to be limited by the resistance at 1.08.
Supports and resistances:
1.0885 ***
1.084 **
1.08 ***
1.0779 Last
1.0705 ***
1.067 ***
1.0635 **
USD/JPY Intraday: capped by a negative trend line
Pivot: 118.85
Our preference: short positions below 118.85 with targets @ 118.25 & 117.95 in extension.
Alternative scenario: above 118.85 look for further upside with 119.3 & 119.7 as targets.
Comment: the RSI lacks upward momentum.
Supports and resistances:
119.7 ***
119.3 ***
118.85 ***
118.46 Last
118.25 ***
117.95 **
117.6 ***
GBP/USD Intraday: the downside prevails
Pivot: 1.468
Our preference: short positions below 1.468 with targets @ 1.459 & 1.456 in extension.
Alternative scenario: above 1.468 look for further upside with 1.4725 & 1.4755 as targets.
Comment: technically the RSI is below its neutrality area at 50. The pair is trading within a bearish channel.
Supports and resistances:
1.4755 **
1.4725 ***
1.468 ***
1.4622 Last
1.459 **
1.456 **
1.4535 **
AUD/USD Intraday: the downside prevails
Pivot: 0.7135
Our preference: short positions below 0.7135 with targets @ 0.705 & 0.7015 in extension.
Alternative scenario: above 0.7135 look for further upside with 0.7175 & 0.7215 as targets.
Comment: a break below 0.705 would trigger a drop towards 0.7015.
Supports and resistances:
0.7215 ***
0.7175 ***
0.7135 ***
0.7064 Last
0.705 ***
0.7015 ***
0.699 ***
SPI 200 (ASX) (H6) Intraday: the downside prevails
Pivot: 5135
Our preference: short positions below 5135 with targets @ 5040 & 5010 in extension.
Alternative scenario: above 5135 look for further upside with 5190 & 5232 as targets.
Comment: as long as the resistance at 5135 is not surpassed, the risk of the break below 5040 remains high.
Supports and resistances:
5232
5190
5135
5077 Last
5040
5010
4970
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