AUD/USD Consolidation continues

The Australian dollar was trading slightly elevated against the US dollar in early hours today following the Q4 report release, that showed better than expected numbers. The pair marked daily high at 0.7694, but shortly afterwards retreated to lower levels and the current market price is 0.7665. 

Anyway the pair continues to stay within the well know tight range, failing to move up. The upward potential is limited by the bearish 20-day SMA, currently being around 0.7680 area. On the four-hours time frame RSI is below the mid-lines and is turning to south, while stochastic is located within oversold are and is loosing directional strength. Immediate support is seen at 0.7660 and in case of closing below it, bears most likely will try to test next one at 0.7600. Looking to the upside first resistance is placed at 0.7720 (last week highs) and higher at 0.7740. 

Gold is shining brightly

Since the end of last year Gold is up with more than 11%. The precious metal bottomed at $1122 in mid December, but today posted a fresh daily high at $1263.90, which is the highest level for the past three and a half months. Bulls conquered the resistance at $1261, where now is located the 200-day SMA, but the price slightly retreated later to currently trade at $1251. 

Technical readings on the daily chart confirm the uptrend. The 20-day SMA is showing strong bullishness. RSI and stochastic are indicating overbought conditions and are keeping directional strength. But we must pay attention to the development within the positive area, as no firm bearish signals are seen around. Even well established within the positive territory, both RSI and stochastic have turned slightly to south.

Gold is definitely influenced by Trump’s policy, particularly his tax reform intentions. And honestly this is not positive for the precious metal. Tomorrow’s speech is long awaited and let’s hope that will enlighten markets with some definite measures.

However during the last three and a half months gold is steadily moving up and I’d rather bet that the sentiment will stay positive. 

GBP/USD Risk remains towards the downside

The GBP/USD started the week weaker and early this morning hit low at 1.2381, as the pair was undermined by the reports that Scotland may call a second independence referendum as early as next month. The pair bounced off the low and currently is trading slightly above 1.2400 handle. 

As seen on the four hours time frame the price has crossed to below the bearish 20-day SMA. RSI is standing at around 38 and has lost directional strength. The stochastic is showing strong oversold conditions and is displaying bearish momentum. Technical readings confirm that the risk remains towards the downside. The macro agenda for today is not offering much from UK side, but on the other shore we have data on Pending Home Sales, Durable Goods Orders and the FOMC member Kaplan speech. So Sterling might be seen stronger only if US data disappoints. 

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GBP/USD Correction Underway

The Sterling moved sharply higher against the US dollar on Thursday, succeeded to move out of the narrow range in which varied lately and closed at highest levels for the last three weeks. 

The GBP/USD is currently trading at 1.2550, slightly above the bullish 20-day SMA and very close to the upper side of latest range. The pair is seen gravitating around this level since yesterday and seems that bull are not fueled enough to occupy higher areas. The four-hour time frame is showing that both RSI and Stochastic are placed within the overbought area, but are starting to turn to south. Should the pair overcome the resistance at 1.2576, another positive outcome will be pace along with new daily highs above 1.2600 level. On the other hand, if retreats back to 1.2500 region, bearish correction is underway, given also the fact that latest rally is due to the broad US dollars weakness, rather than Sterling's strength.

EUR/USD higher

Since the beginning of the week the EUR/USD has been sliding to downwards and in the early European session today hit a six week low at 1.0495. Finally we witnessed some revival right after the FOMC minutes release. As it was expected the US central bank voted to keep rates unchanged, although many FED officials see a rate hike „fairly soon” if the economy remains on track.

Following the FOMC minutes release the EUR/USD pair surged towards previous highs and the current market price is 1.0572. 

The four-hour chart is showing that the price is now flirting with 23.6 % Fibonacci retracement of latest decline and where now the bearish 20-day SMA is located. RSI and Stochastic have recovered from oversold region and have turned to north, but yet are below the mid-lines. The psychological mark at 1.0600 remains key resistance and in case bulls succeed to advance though it, next target is seen at 1.0620 (38.2% Fibonacci retracement of same decline). Looking to downwards first support is placed at 1.0520 (February 15th low) and lower at 1.0495 (the daily low).

AUD/USD stuck between 0.76-0.77

The release of the RBA Minutes showed that the low rates will be maintained a while longer. The bad figures in Q3 GDP,  lower than expected consumption growth and the inflation expectations raised doubts over the appreciation of the national currency that might cause difficulties to economic transition. Amid those concerns the AUD/USD pair today is holding within the well know tight range between 0.76 – 0.77. Looking at the four-hour time frame, the price is trying to move above the 20-day SMA, which has turned into bearish mode. Meanwhile the 100-day SMA is acting as a dynamic support. Technical indicators have recovers from oversold readings. RSI is slightly above mid-lines, but is loosing strength and Stochastic is showing strong bullish momentum. So far there is nothing sure to confirm bullishness. The key resistance at 0.77 is being long term lived and as long as holding above 0.76, the down slide remains unlikely.  

USD/JPY in narrow intraday range

Last week the USD/JPY tried to move higher, but in the last three sessions plummeted and closed at 112.82. Today the pair was seen hovering around 113.00 mark and finally established slightly above to currently trade at 113.10. In the four-hour time frame the 100-day SMA is sliding to downwards and is confining a potential recovery. RSI is staying flat around 43, while Stochastic has retreated from oversold area and is showing bullish signs, but yet both indicators are below their mid-lines. First resistance is located at 114.95 and next at 115.60. Support is seen at 111.60 and lower at 110.95.    

Gold found support at 100-day SMA

The strong US economic data along with the hawkish comments of the Fed Chair Janet Yellen uplifted the US Dollar index and consequently dragged Gold prices lower. The precious metal marked today a  two-week low at $1216, but found support exactly at this area where currently is located the 100-day SMA and succeeded to escape towards $1230 region. As seen on the four-hour time frame during the past two sessions technical indicators have been placed around mid-lines, but today are showing signs of slight bullish momentum. Strong resistance is located at $1248 (50% Fibonacci retracement of latest July to December decline) and given the fact that bulls couldn't find enough strength to conquer this level we may consider that the situation is ruled now by the bears. Immediate horizontal support is seen at $1218 (38.2% Fibonacci retracement of same decline) and in case of fluctuating again around this level, Gold is poised to extend the downward slope towards the psychological $1200 mark.

XAG/USD Bulls are currently in play

Silver prices continue to move higher and currently are well situated  within the bullish channel, started from late December. During the past sessions bulls were challenged by the 200-day SMA (currently being at  17.85) and as seen on the daily chart finally this level was finally conquered. On the same chart technical indicators are placed in bullish territory having marked higher highs and lower lows. In the short term  the bearish pressure seems to be limited as long as the price holds above 16.55 (January’s low). First resistance is seen at 19.00 (November 2016’s high) and higher at 20.11 (September 2016’s high).

EUR/USD broke below the bullish channel

EUR/USD tried to push higher yesterday, but after marking an intraday high at 1.0658 closed lower at 1.0596. As seen on the four hour chart, the pair broke below the bullish channel and the 200-day SMA. Technical indicators have retreated from oversold region, but yet are well below the mid lines and confirming the bearish bias. Strong resistance is seen at 1.0650 and in case of surpassing it, probable bullish target will be 1.710 area (last week’s highs). On the other side, the downward pressure will be increased in case of crossing below 1.0590 (yesterday’s low). Next supports are located at 1.0550 and 1.0520.

USD/CHF inside the uptrend

The USD/CHF pair was trading elevated last week and topped at 1.0061. As seen on the four-hour time frame, the price is developing inside the uptrend channel. The 20-day SMA is indicating strong bullish momentum. Meanwhile indicators are well established at the overbought area. Both RSI and Stochastic have lost strength to hint next direction. In the short-term the bias remains bullish and a clear break of 1.0060 to above will encourage bulls to test 1.0120 or higher. On the other hand, immediate support is located at 0.9980 and in case of crossing it to below, the pair will settle within the neutral trading zone around 0.9930 – 0.9900. 

AUD/USD in sideway mode

Friday’s upbeat statement of the Reserve Bank of Australia (RBA) uplifted the AUD/USD. The pair escaped from the lower register of 0.76 handle and rallied towards 0.7690.  As the pair is now back to the key resistance at 0.7700, a clear break above will open doors for testing next one at 0.7777 (November 8^th high). Looking downwards first support is located at 0.7656 (today’s low) and next at 0.7640. On the daily chart the 20-day SMA is displaying strong bullish momentum. Both RSI and Stochastic are showing extremely overbought conditions but yet displaying lack of momentum. However, the price has now settled in the 0.7600 – 0.7700 range and most possible will extend its sideway movement.  

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USD/JPY Short-term Bullish

Yesterday the USD/JPY pair moved 131 pips higher after an amazing rally. Today we’re witnessing acceleration of the bulls’ strength as the pair is testing the 114.00 level. The positive bias is confirmed by crossing to above the bearish 20-day SMA. This breach undoubtedly will open doors to 115.00 region, where the 55-day SMA is acting as a resistance. On the daily chart technical indicators are firming the continuation of the upside run. Meanwhile bears visited several times the 111.50 area, where the 100-day SMA is acting as intermediate support, but yet can not enough power to pass through it. The near-term bias has shifted to bulls’ camp.  

Gold At Three Month High

As both Europe and USA are overtaken by political woes and uncertainty is rising, investors are eyeing precious metals. Gold prices resumed the upward movement and yesterday marked the highest level since November at $1244. 

Technical indicators have modestly retreated from the overbought region. As seen on the four hour frame RSI is located slightly below 70 and is showing lack of momentum. Stochastic is displaying modest bearish direction, but yet is within extreme overbought area.

Short-term support is found at $1230 (50% Fibonacci rertracement of latest $1137 to $1122 decline). Next support is seen at $1204 (38.2% of same retracement).

To the upside bulls are thrilled by $1245 (a multi month high) and if conquering this level, next target is the resistance at $1255 (61.8% Fibo). 

Among this political uncertainty, a march towards the $1300 handle seems to be quite possible, due to the increased demand for safe-heaven assets.   

EUR/USD Couldn't Hold Above 1.0700

During the early European session EUR/USD marked an intraday low at 1.0640, which is the lowest level for February. Shortly afterwards the bulls found enough stregth for recovery and pushed the pair to the daily high at 1.0713, where the the 20-day and 100-day SMAs have met.  

The upward potential is now limited by the 1.0720 region, because as clearly it is seen on the H4 chart this exactly where the 20-day SMA is crossing to downwards the 100-day SMA. Technical indicators have recovered from oversold area, but yet are below the mid-lines. RSI is showing lack of momentum and Stochastic is displaying bullish momentum. 

Given that the bulls will need more powerful incentive to confirm their strength. Intermediate resistance is seen at 1.0750 and next at 1.0800. The current market price is 1.0688 and if failing to hold around this area, the pair is poised to reinforce the downward slope towards 1.0650 and even lower towards the key support at 1.0590.

GBP/USD Vulnerable Ahead Of The Final Vote

Ahead of final Brexit vote the GBP/USD pair remained in consolidation during today’s trading, but as the time nears, the bulls are showing persistence.Both Sterling and the US Dollar are finding fundamental challenges at the time being. The greenback is weakened by the Trump’s course of action and the GBP is experiencing the highly weighted pressure on Brexit development.

Technical indicators in the hourly chart are located within overbought area. RSI has turned to south, but is still above 50 level. The Stochastic displayed strong bullish momentum today, but currently is loosing momentum.

The 50-day SMA is placed around 1.2470 region and is acting as a support. If broken, next bears target is seen at 1.2400 handle. Looking to the upside the pair is facing first resistance at 1.2545 (the weekly highs) and next at the key level 1.2600. 

GBP/USD is quite vulnerable ahead of final vote on Brexit, but in the short-term this is the main driver that would set more clear direction for the pair. 

Will The Fire Rooster Be The Market Booster

As the many antics of the inconsistent, sizzling and mischievous characteristics of the Red Monkey left significant tracks and marked 2016 with strong glitters and jitters, now new awakening is in force.

Along with the Chinese Lunar New Year, new expectations are rising. The urgency, energy and vibrancy of the desired changing environment will be set in motion with the Fire Rooster.

If there is something in your nature that do not understand or accept the Chinese zodiac, I would only  like to drag your attention to the signals of this New Year from another viewpoint and to implement some signs  into the tentative market forecasts.

The comfort provided by complacency and indifference is a past. The future will be fuelled by a certain ambition and assertiveness. 

And here is a slight glimpse of what is about to come along with the Fire Rooster.

A distinctive feature of the Rooster is not be quite and not to care about what is expected or desired. Do you find any resemblance with the new US President elect? Daring tweets, new Berlin wall, immigration ban. And meanwhile the Trumponomics is offering fiscal relaxation and protectionism, which is inflationary and is supposed to reinforce the US Dollar bulls. Yet it is too much and yet it is too soon to see how this will enact and how much time it will take to affect. One thing is sure – markets are at risk caused by the disappointment of Trump trade.

The conflicting elements of fire and Rooster’s self confidence and ambition could be clearly be read in Brexit drafts. How hard it will be and how Europe will handle it? Talks will not end soon, but talks are affecting the markets. Sterling will be extremely vulnerable and UK assets’ value will be marked down. 

Oil market balance is undetermined. The supply glut is still labelled by some unknowns. And markets are going to shift the mood into „Wait and see” mode. 

The Rooster is going to blaze with the characteristic of alarm clock and is going to brake the silence of uncertainties related to the banking sector. The optimisms towards the investible global banks is rising along with the outlook of higher interest rates. The economic growth is accelerating as policy gears are switching from monetary to fiscal measures.  

I have outlined just some fews, but within the geomagnetic field of importance. Of course some side effects such as plummeting of the Mexican peso and Turkish lira , Russia’s escaping the trend and China’s capital outflow shouldn’t be neglected.

In summary, the year of the Rooster will bring simultaneously optimism, movement, changes and turbulence on markets. And new opportunities on personal level.

Whatever you meet at this year unfold, I suggest you always to think about the present - how wide it is, how deep it is and how much might be yours to keep. Transform your fears into prudence, mistakes into intuition and desire into undertaking. Then the Rooster will be your booster!

AUD/USD Bulls Keep On Moving

The AUD/USD pair powerfully moved to the upside and printed fresh three month high at 0.7695 today. Strong macro data from Australia supported the surge, driven mainly by the fantastic trade surplus. 

Upon the US session the pair pulled back and is currently trading at 0.7661. 

Since January 17th the pair  has been caught within relatively tight range, but now seems to be getting out of it. In the short run this performance could be read as correction to the downside. But the four-hour time frame is indicating bullish trend. The price has crossed to above the 20-day SMA, which is also in tact with the bulls. RSI has retraced from the overbought territory and Stochastic has turned to south. Generally this is against the short term bullishness, but I think that both indicators are now in favour of the current pullback and do not significantly prove further decline. Strong support is seen at 0.7600 and lower at 0.7550. Resistance is located now at 0.7695 and higher at 0.7777.

GBP/USD at 23.6% Fibonacci retracement

After marking a fresh multi-month high at 1.2705 the GBP/USD pair dropped sharply today. The pair is currently visiting the 23.6% Fibonacci retracement of latest January to February uprise. Bears reached out and found a temporary shelter at this level as it’s acting as a support now. 

The four-hour time frame is showing bearish signals, generated by the technical indicators. Both RSI and Stochastic have turned to south and are displaying strong downward momentum. The price has crossed to below the 20-day SMA. Bears might be reinforced in case of passing through the 38.2% Fibonacci retracement of same upward leg at 1.2431. Although the current pullback might be seen as correction, the risk of further downslide remains in pace until the NFP data from US due tomorrow set more clear direction for the Cable.