European markets in reverse as Thursday’s ECB announcement continues to digest. European equity markets regained losses its previous day’s losses on Friday with the DAX up 3.51% and the FTSE 1.71%. Despite Central Banker Draghi’s announcement of a larger than expected policy easing, the EUR rallied and equities tumbled. Analysts believed this knee-jerk reaction was in response to comments made within the press-release, as Draghi commented he has no anticipation for further rate cuts. Although many central bankers currently desire low currencies to stimulate growth, one must achieve this at the expense of another.
WTI crude oil hit a high of $39/bbl as global oil supplies begin to ease. In February production slowed by 180kb/d to 96.5mb/d as OPEC and non-OPEC output falls. OPEC crude oil production eased by 90kb/d as supply eased from Iraq, Nigeria, and the United Arab Emirates. These were partly offset by rising production from Iran.
The Australian dollar continued to strengthen on Friday evening, surging to 0.7580 on the back of USD weakness. The AUD/USD pair has been driven by recent risk-on sentiment, NIR environment and rising commodity prices.
Currency Updates:
EUR/USD ST: bullish bias above 1.0820.
Pivot: 1.0820
Our preference: long positions above 1.0820 with targets @ 1.1375 & 1.1495 in extension.
Alternative scenario: below 1.0820 look for further downside with 1.0570 & 1.0450 as targets.
Comment: a support base at 1.0820 has formed and has allowed for a temporary stabilisation.
Supports and resistances:
1.1720 ***
1.1495 ***
1.1375 ***
1.1157 Last
1.0820 ***
1.0570 **
1.0450 ***
USD/JPY ST: key resistance at 116.00.
Pivot: 116.00
Our preference: short positions below 116.00 with targets @ 110.00 & 107.50 in extension.
Alternative scenario: above 116.00 look for further upside with 118.75 & 121.70 as targets.
Comment: technically the RSI is below its neutrality area at 50.
Supports and resistances:
121.70 ***
118.75 ***
116.00 ***
113.81 Last
110.00 ***
107.50 **
105.20 ***
GBP/USD ST: key resistance at 1.4660.
Pivot: 1.4660
Our preference: short positions below 1.4660 with targets @ 1.3835 & 1.3630 in extension.
Alternative scenario: above 1.4660 look for further upside with 1.4950 & 1.5240 as targets.
Comment: as long as the resistance at 1.4660 is not surpassed, the risk of the break below 1.3835 remains high.
Supports and resistances:
1.5240 **
1.4950 ***
1.4660 ***
1.4375 Last
1.3835 **
1.3630 **
1.3180 **
AUD/USD ST: the upside prevails.
Pivot: 0.7100
Our preference: long positions above 0.7100 with targets @ 0.7805 & 0.8080 in extension.
Alternative scenario: below 0.7100 look for further downside with 0.6820 & 0.6650 as targets.
Comment: the RSI is bullish and calls for further upside.
Supports and resistances:
0.8310 *
0.8080 ***
0.7805 ***
0.7566 Last
0.7100 ***
0.6820 **
0.6650 ***
SPI 200 (ASX) (H6) Intraday: further advance.
Pivot: 5120
Our preference: long positions above 5120 with targets @ 5230 & 5262 in extension.
Alternative scenario: below 5120 look for further downside with 5075 & 5040 as targets.
Comment: the RSI is mixed to bullish.
Supports and resistances:
5300
5262
5230
5205 Last
5120
5075
5040
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