Trader Talk

USDX: 89.15

Trump’s State of Union today could deliver significant ramification for the forex market, and to be specific, for the shadowing performance and aggressive selling pressure involved with greenback.

However, the chart depicts very little rhyme for the interest of buying the low.

Compensated with political uncertainty and seesawed price action, traders starting to bid aggressively on U.S. dollar up, and we should reemphasize on the counter currencies and Australia Q4 CPI data is considerate important.

USD JPY: 108.95

Consolidative phase for the USDJPY is continued, the correction yesterday wiped Monday’s gains.

Elsewhere, BOJ’s Rinban and tapered Quantitative easing policy signals strong prospects for the Yen against dollar, coupled with weakness the dollar exhibits for the last few weeks.

The short term momentum (20 day RSI) suggests a relatively positive spot, looking up at 38.6% retrace level 109.40 and possibly onto 110.07, although the prudential scheme would be that await the State of Union to play out itself.

EUR USD: 1.2380

The EURUSD settles around a comfortable zone. Market rallied a bit in response to technical aspect. Unchanged consumer sentiment index is solid indication of a continuation of growth.

Alternate between EU data and overbought territory, the pair should find support at 1.2335 which has been tested twice this week, and 38.2% retracement at 1.2300 to be advanced.

GBP USD: 1.4070

The Bank of England Governor Mark Carney upbeat tone on GBP and risk-off sentiment in the market lead the market today alongside with stretched valuations and FOMC.

Hegde fund manager and CIO at the Bridgewater Associate LTD said that we are in a perfect goldilocks’ scenario, everything is going great, inflation, growth and employment all booting the economy.

Tax cuts stimulated the corporate side of economy, however, the protectionism it projected by the Trump administration causes weary

AUD USD: 0.8095

Really big day for the Aussie, since the Q4 CPI is down the corner.

Last week’s New Zealand CPI data stirred 100 pips and more volatility in just 30 minutes, which of course produced big winners and losers at both side of the trade.

If the Australia CPI data comes low, say 0.2%~0.5% instead of 0.7%, we could expect significant market reaction in a short amount of time.

Better to place trades before hand, if our active trader wishes to info-speculate.

NZD USD: 0.7325

Bumpy week ahead, a break below a key psychology level at 0.7260 could be our new established support, however, recent political uncertainly would inject significant momentum for all counter currencies against greenback.

The rate is tip-toeing around 0.7375 and the fundamental has strengthened since last week supported by positive retailed sales and commodity price.

Warning regards to entering short, market sideways and looms the pairs.

USD CAD: 1.2340

USDCAD holds the position above 1.23 level, strong rally in London session however quickly pulled back and entering consolidation phase over the day ahead of both US and Canada economic events.

Recent gain the pair also supported by retracing oil price for two days consecutively.

Nevertheless, directional bias still not yet confirmed, however the mystery will be revealed later this week following Canada’s GDP report and FOMC meeting as for fresh impetus.

VIX: 14.80

2nd consecutive day drop in US500 index as it retreats from records high ahead of some influential major events. Investors highly anticipated the FOMC meeting as the outcome would highly impact the outlook for the US index. The fear Index continues to increase in results of continue sell off in the equities.

GOLD: $1,335

Gold tried to push up during the NA session, however ended with stronger bearish view than as US makes a comeback following the Fed decision in the upcoming meeting.

Gold failed to hold on its last week gain as the price is expected to decline as few of US major data will be revealed. Investors awaits signs of the next rate hike, especially on March hike.

OIL (WTI): $63.75

WTI failed to hold ground above $65.00 as the largest drop in a trading day for this year and breaks below the key mark, following the prevailing sentiment of investors as correction of the oil market, fed by the recent increase in US active oil rigs.

Looking ahead of the official report regarding US crude oil supplies.

BITCOIN (BTC):

Series of negative news keep pressuring the cryptocurrency, testing below the key level $10,000 for multiple times, following the hacking incident against Coincheck exchange. The drop further fuelled by the Tether scam which comes out to be true regarding price manipulation.

To be back up settle at above $10,000 level would show a positive sign for Bitcoin, however on the downside, breaking below $8,000 would indicate strong bearish point of view.

Macro Themes in Play

• USD captures strong momentum and looking up to next resistance

• AUD dollar hold gains and wait for more fundamental to play out

• AUD and NZD would be sensitive to China Q4 PMIs, figuring the channel ahead