Trader Talk

USDX: 89.45

Comeback from the greenback with remains bid in multi-day top which testing above 89.50 level, as it traded higher against most of the major currencies. The existing support from the better than expected employment data, further fuelled by the release of US ISM non-manufacturing data which scored above expectation at 59.6 from previous 56.0. Greenback’s better tone boosted by an increase in US 10-year reference to around 2.85 region. Investors expect the dollar has found its bottom and beginning to rally.

USD JPY: 109.15

The only major currency that stood the US’s recovery as the bears still remain in control with the pair failed to hold above 110.00 level, following another risk aversion hit the markets with US indexes ending the day down over 1,000 points as investors look for safety. The pair bounce back slightly ahead of Asian session; However, it needs to close above 110.50 to turn into upward momentum.

EUR USD: 1.2375

The pair unable to hold its previous persistent position and gave in, breaking below the 1.2400 level despite of higher revision on the PMI numbers as retail sales missed by -1.1% decline from previous positive 2.0%. Draghi’s comments also failed to put a significance impact o the currency, on the other hand the dollar bulls have enjoyed the better than expected ISM data. Crossing down the support level at 1.2330 would convert the consolidation phase to first sign of downward momentum.

GBP USD: 1.3955

Another heavy sold off to the pair ahead of BOE statements later this week, as negative sentiment triggered last Friday by the fell in PMI index which resulting in Investors’ fear that BOE would be less optimistic to raise the rate given the slowdown numbers. Further dragged down by government’s decision in postponing the publication regarding plans for UK’s post-Brexit immigration. All attention on BOE’s statements, bulls hopping that would settle back up to 1.4000 level ahead of the events.

AUD USD: 0.7875

Busy day for Australia with upcoming retail sales, trade balance, and RBA’s rate decision on the calendar, as investors looking ahead of the RBA looking for drivers in the currency. Investors have positive outlook on RBA’s optimisms as previous economic reports showed promising result. The pair however in a weak position below 0.7900 level ahead of data release as risk aversion came in and stronger USD. If the decline in Wall Street continues, the declining pair would be deepened.

NZD USD: 0.7255

The Kiwi seen to be attempting take on recovery back above 0.7300 however failed and surrendering to around the 0.7250 level, as attention towards the key macro events as well as recent tumbling oil price. Investors’ sense of caution ahead of the NZ unemployment rate data as well as the following day RBNZ rate decision. However, the downside seemingly to be capped as bulls supported by solid Chinese PMI data with higher than forecasted.

USD CAD: 1.2530

The ascending channel established on February 2rd still holds, and we have valid velocity and momentum coming into play, testing January 17th high at 1.2539. Two clear waves confirm the psychology in the market. USD begins to rally in response to the rising concern over the plummet in U.S. equity market. On the flip side, the selling pressure for oil worries the loonie. RSI still advance in overbought territory, potential resistance can be seen at 1.2550.

VIX: 37.32

Intraday appreciation is 115.60%, risk-off sentiment begins to sweep the market across the board, last time we’ve witness this correction origins straight back to 2007. USD, JPY, and CHF are rallying in response to the massive sell-off in U.S. equity. Many big-time ETFs correlate to VIX has endured enormous losses, and VIX marching toward 40.00 definitely demonstrate contagious fear for the 2018 economy outlook.

GOLD: $1,340

XAUUSD has been trapped in a confined channel, unable to hold gains. (peaked at $1,3388.49 and dollar resurgent pulls it back again) Precious metal produces one of the least volatile products during recent uncertain times. Immediate support at $1,327.30 is next to watch, however, with the directional alternation starts to hit global institution. A breakout of current established channel would not prove to be surprising.

OIL (WTI): $63.60

Our next immediate support for WTI oil is its January low at $62.90, in the meantime, we are witnessing the greatest fear-sentiment for almost 10-years. Shifty direction and motivated momentum fulfil our market with ample opportunity for our traders. Currency operating range defined with high as of $66.65 and low as $62.90, which could easily prove to be breakable in the coming weeks.

BITCOIN (BTC): $6,810

Dipping below $7,000, bitcoin is now operating its November 2017 price level. 60% of bitcoin value has evaporated in last few days, and black January continues. Chinese government clamping down the exchanges alongside with Korea. We can find turnaround region lies within $6,500~$6,650 level. And our crypto traders could use the goodwill of bitcoin being the reason for the opportunity lies ahead, for no clear long term bearish outlook yet been seen in the market place.

Macro Themes in Play

• U.S. dollar is seemingly on its recovery phase, gaining strength against major currencies

• US indexes plummeted hard with the highest daily drop history record

• EUR failed holding its gain following major events