USD/JPY Remains bullish despite the dovish Fed

It’s all about Fed today. As widely expected the Central Bank left the interest rate unchanged but markets took their time to react on the dovish statement before the US Dollar dropped.

Well it’s hard to define the future as know or unknown. The Fed didn’t say that the outlook has improved. If the prospects are not better, there is no reason to accelerate increasing rates. Also  chances for a June hike after the statement seem to have disappeared. On the other hand the use of moderation word, copied from the ECB President Mario Draghi is a way to describe the slowdown. Meanwhile the US dollar gained strength during the past weeks and the hours before FOMC and this comes along with rising bond yields. This combination of fact and words after all pushed the greenback lower but it seems that this would be short lived.

USD/JPY fell to 109.60 as a reaction of Fed’s decision but then bounced to currently trade at 109.95. Technically speaking the short-term outlook remain neutral to bullish. On the four hour time frame the price is developing above its bullish moving averages.RSI and stochastic retreated from their extreme overbought areas although remain flat within the positive territories. 

As long as the pair holds above 109.00 handle, the trend favors the upside with next target for the bull at 110.00, which if broken to above would open doors for testing the February’s hi at 110.45.

USD/CHF Above 0.9500

The power awakens for the US dollar while the single currency suffered huge drop today. As it was expected the ECB kept the interest rate unchanged but removed from the statement the phrase of needing to extend QE if conditions worsen. The euro retreated from its recent location and dragged the Swiss franc lower.

But at this time the USD/CHF broke the resistance at 0.9470 and pinned fresh new high at 0.9518 and currently is trading at 0.9415. On the four hour time frame the price is developing well above its moving averages. RSI and stochastic are located within extreme overbought areas and both are showing strong upward momentum.

Next significant territory for the pair is 0.9570 which if bulls succeed to conquer will be eyeing the key level at 0.9600 and higher around 0.9650.

EUR/NZD Closing outside of the wedge

Since June 27 EUR/NZD has entered into ascending channel, but the pair abandoned it in mid December. Bulls attempted to enter into it again, but failed. Currently the pair is trading at 1.7045, the point of the exit from the channel and the staring base of the wedge formation. 

As clearly seen on the daily chart the top side took shape and the price is about to close outside of it. Another confirmation for the rising bulls' froce is the importance of this level, support turned into resistance. RSI and stochastic are floating within warm positive territories with strong upward momentum. Short term support is provided by the 100-day SMA at 1.6894, around which the price was hovering around last week. To confirm the bullish bias in the long term bulls should conquer at least the 1.7450 handle in order to get back into the uptrend channel. 

USD/JPY Up on hawikish FOMC, but will bulls dare to get out of the prevailing downtrend

Since January 8th the USD/JPY pair entered into steep downtrend channel, which came in continuation of the bearish signals from early November. This week the bears are taking break and stopped to rest around 108.30 level, a significant support area. Of course having the development of the channel, a test of the lows around 108.30 – 108.00 could not be avoided. 

But today the fundamental environment comes into play with last Janet Yellen’s speech at FOMC. As it was expected the interests rates remain unchanged and Fed left open door for hikes in March. The outcome for the pair is somehow mixed, but we can not ignore that bulls moved towards 109.00 handle. Тhe agenda now is whether the bulls will dare to escape the shackles of the descending channel.

GOLD Correction to reinforce bulls

Spot Gold started the new week in smooth mood, having quite tight daily range. The US dollar surprised markets with strength after poor US jobs data, released last Friday that was not affected by the expected rate hikes approaching this year.

As seen on the four hour time frame, the XAU/USD pair is developing well above its bullish moving averages. RSI and stochastic got out of their extreme overbought areas and had lost directional strength, but yet remain on higher levels. Given all above it seems that this corrective phase is going to call back the bulls. The precious metals stands above the 23.6% Fibonacci retracement of latest upleg (at $1305) and the initial support at $1313 (Friday’s low) is untouched by the bears. A deeper correction  might follow only in case of testing the 38.2% of same Fibo at $1292, but not lower. 

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Gold unable to extend the post-Fed gains

Following the Fed’s rate hike decision gold prices surged and marked one week high at the level $1259.00, but today is seen few pips lower, hovering around a neutral space at $1255.00. The US Dollar’s selling pressure is relieved by the uptick in the US Treasury bond yields which further impedes the gold bulls.
On the four hour time frame XAU/USD crossed to above its 20-day SMA that is starting to turn north while the 100-day and 200-day SMAs are showing bearish slopes. RSI has reached 60 level but currently is changing the direction. Stochastic is displaying strong bullish momentum and is located within extreme overbought territory and some exhausture exhaustion begins to emerge.
Immediate support comes at $1250.00, below which bears are likely to test $1247.00. Looking to the upside first resistance is provided by the daily high at $1259.00 and in case bulls succeed to regain this level, next target is the 200-day SMA at $1267.00.
Later in the day monthly retail sales and initial jobless claims are due from the US and in case of affected greenback, fresh impetus would be given to the precious metal.

EUR/USD To make or break

During the past week EUR/USD continued to develop between the April bullish trend line and the September bearish one. As seen on the daily chart the price touched, but couldn’t break the support provided by the first trend line and meanwhile is standing well above November’s low.the levels of support around 1.1800 were tested and were broken, but more significant challenge is the area around 1.1720 – 1.1730, because there is confluence of horizontal and trend-line support. So this is the place for pair to make it or break it.

On the same chart the 20-day SMA and 100-day SMA are staying flat above the current price movement and are providing resistance at 1.1800 – 1.1825, while the 200-day SMA is keeping bullish stance. RSI is located around 45 and has lost directional strength. Stochastic is displaying strong bearish momentum and is nearing extreme negative territory.

However the upcoming week will determine whether the bottom line would be under occupation of the bears or euro bulls would fight it.   

EUR/USD Remains bearish ahead of NFP

The EUR/USD pair continues to suffer and today extend its decline to 1.775 with current market price 1.1777. The marco agenda today counld’t affect much the pair’s behavior as NFP day tomorrow will provide larger impact. And having ECB and Fed meetings next week we will witness really thrilling development on the pair.

On the four hour time frame the price is situated below flat 100-day SMA and bearish 20-day SMA, while the 200-day SMA is keeping neutral stance and is provide support at 1.1745. RSI is located within negative territory and is showing bearish momentum. Stochastic is displaying extreme oversold conditions, below 20 level and has lost directional strength.

With US Senate intending to extend the debt ceiling and avoid a government shutdown and US dollar might add some fuel, otherwise the pair is poised to extend its decline towards the support at 1.1715, having the expectations of NFP tomorrow. 

AUD/USD Bulls can’t fight 0.77 handle

Aussie hit a new fresh four-month low at 0.7609 yesterday, a level that has not been visited since July 11th. And this is where the AUD/USD pair found support after the stellar performance of the NAB August business conditions survey figures. 

Today the pair is seen higher and marked daily high at 0.7651, but currently is tarding at 0.7631. The retreatment is mostly due to the China’s macro data that was softer than expected.

Technically speaking, Aussie keeps its bearish stance since early November when bulls lost the fight for the 0.77 handle. On the four hour time frame the price is developing below its moving averages, all with bearish slopes. RSI is hovering around 40 and has lost directional strength. Stochastic is showing bullish momentum, but is yet far below its mid-line. 

Yestarday’s low is providing immediate support and in case of breaking to below, doors are opened for testing 0.7570 (early July’s low). 

USD/JPY Broke to below the ascendant channel

During the early session today the USD/JPY pair dropped to 113.31 and later had retreated to 113.54. the greenback is still suffering due to the Trump Jr’s affairs and ahead of Fed's head Yellen testimony.  

Technically speaking the pair broke to below the ascendant channel and is currently developing below the 20-day SMA. 

The four-hour time frame is showing bearish signs. RSI is nearing oversold area and is slightly below its mid-line. Stochastic is displaying strong bearish momentum and is located within negative territory. Nevertheless both indicators had lost directional strength. 

To confirm the bearish continuation the pair should fight the key support at 112.85. 

Aussie at 2-week high, but in the long term remains bearish

Today the Aussie marked fresh two-week high at 0.7445, but during the US session pulled back to currently trade at 0.7414, as the greenback trimmed losses. 

Technical readings in the four-hour time frame are showing that bulls are retreating from the intraday high. The price is moving above the 20-day SMA, which is pointing to upwards. RSI and stochastic has corrected from overbought territory, but both are yet well above their mid-lines.

In the short term the pair is trending higher, but in the long term bears rule the situation until price is holding below the descendant trend line that has started from late March’s high at 0.7749.