Tag: AUD/USD

FX Commentary – Safe Havens Rose On Worries Of A Slower Global Economy

Nicholas

Market Talk
– The safe-haven U.S. dollar and yen rose on Tuesday as market sentiment turned risk-averse amid renewed worries about the U.S. banking sector and the outlook for the global economy, which knocked the euro off a nearly 10-month high.

– U.S. consumer confidence index fell to 101.3 – the lowest since July 2022 – from a revised 104.0 in March. The U.S. Richmond Fed manufacturing index was down at -10 in April, the fourth straight month of contraction. Both surveys negated strong U.S. housing data which beat estimates with a 9.6% rise in March to a one-year high of 683,000 after net revisions.

– The yen firmed 0.6% to 133.49 per dollar even as the BOJ’s new governor Kazuo Ueda signaled he was in no hurry to change monetary policy. The euro declined to $1.0969, having risen 1.2% so far in April. Sterling was down 0.6% at $1.2403, but was close to a 10-month high of $1.2545 reached earlier this month.

– The Australian dollar took a further knock on Wednesday, declining to $0.6614, the weakest level since mid-March after a downward surprise in core inflation lessened the pressure for another hike in interest rates next month.

– Gold prices rose to key levels on Wednesday, buoyed by safe haven demand as a string of weak U.S. company earnings and economic data fueled fears of a potential recession this year. Resurgent fears of a banking crisis also boosted safe haven demand


Chart Focus GBP/USD

Key Points

1. Sell GBP/USD recommendation.

2. Sell GBP/USD at 1.2435. Stop at 1.2470 and profit target at 1.2350

3. In increase in risk sentiment and interest rate differential are both in the US dollar favour.

4. Price is likely to be capped by the 20EMA and stochastic is hinting at a price decline.

Fundamental Comments

1. As market sentiment turned risk-averse, the US dollar is likely to be in demand.

2. Interest rate differential is in the US dollar favour.

Technical Comments

1. Price is likely to be capped by the 20EMA which is also hinting at a bearish price trend.

2. Stochastic is moving lower and hinting at a continuation of the downtrend.



Key Levels

Support1.23851.23401.2275
Resistance1.24401.25051.2545









Technical Overview
USD/JPY – Price has moved below the previous week low and could be on its way to 133.10 in a bigger correction move. This is also the Fibonacci ABC formation price target as well. Stochastic is hinting at a price decline. Both MACD and 20EMA are also hinting at a price decline. Only a price move above 134.50 would negate this bearish price view over the next couple of days ahead.

Support133.35132.80132.50
Resistance133.90134.35134.95

EUR/USD – We had a buy recommendation yesterday at 1.0995, which was filled when price declined to a low of 1.0963. The low was just above our stop at 1.0960. Our view may be wrong with market turning to safe haven. We would recommend keeping stop at 1.0960 and profit target at 1.1075. Stochastic is still moving lower but MACD is hinting at a possible price rally. 20EMA is hinting at a price decline.

Support1.09451.09101.0875
Resistance1.09951.10351.1075

AUD/USD – Price reached a low of 0.6601 this morning. There was no divergence warning from the MACD indicator. It means price can continue to move lower to the next support level at 0.6560. Stochastic is hinting at a continuation of this current decline. 20EMA is hinting at a bearish price trend. We think price will move lower. Only a price move above 0.6670 will negate this bearish price move.

Support0.65800.65400.6515
Resistance0.66200.66650.6715

XAU/USD – A move towards safe haven has help to halt a decline in gold at $1975.95. We are likely to see price moves higher to test the important resistance at $2012.35. If price failed to move above this resistance, there could be another decline to $1969 but a move above will hint at price rally to $2048.45. Stochastic and 20EMA are both hinting at a price rally but MACD is hinting at a price decline.1971.

Support1992.851983.351971.40
Resistance2003.702012.352022.40

NZD/USD – Price has failed to move higher to test 0.6225 we had envisioned yesterday. Instead, price is near to the low of 0.6125 despite the divergence warning given by the MACD indictor. Stochastic is hinting at a continuation of this price decline. Both MACD and 20EMA are also hinting at a bearish price trend ahead. A break of 0.6125 is likely to send price down to 0.6080 in the next 24 hours.

Support0.61250.60800.6050
Resistance0.61850.62250.6265

FX Commentary – Expectations of Another Fed Rate Hike Boosted U.S. Dollar.

Nicholas

Market Talk
– The U.S. dollar steadied on Wednesday after it seesawed with bond market volatility as investors scrutinized U.S. economic indicators, Federal Reserve commentary and corporate earnings for clues about the path for interest rates.

– The euro rose to $1.0968 after two consecutive daily declines of more than 0.5%. The greenback gained 0.17% to 134.31 yen, recovering from a 0.29% retreat on Tuesday on the back of a rise in US 2-year Treasury yields, which reached an almost one month high of 4.231% overnight.

– Sterling was last trading at $1.2427, up 0.43% on the day. The British pound jumped despite an unexpected rise in the unemployment rate in the three months to February as pay growth stayed higher than forecast, which could prompt the Bank of England to hike its interest rate again in May.

– The Australian dollar rose against the greenback to $0.6730 after Reserve Bank of Australia minutes yesterday, showed the central bank considered an 11th consecutive rate hike in April before deciding to pause. The RBA, however, said it was ready to tighten further if inflation and demand failed to cool.

– Gold prices fell slightly in Asian trade on Wednesday but stayed above US$2000 level as markets awaited more cues on U.S. monetary policy from a string of upcoming Federal Reserve speakers and reports. But further gains were held back by growing uncertainty over the path of U.S. interest rates, with recent hawkish signals from Fed speakers having spooked markets.


Chart Focus Gold

Key Points

1. Sell Gold recommendation.

2. Sell Gold at $1999. Stop at $2013 and profit target at $1965.

3. Expectations of a other 25bp Fed hike and easing worries of a global recession are both weighing on Gold.

4. Price is capped by the 20EMA with MACD hinting at a bearish price trend.

Fundamental Comments

1. Expectations of another interest rate hike by the Fed is weighing on Gold.

2. A good China data overnight is easing worries of a global recession, which is likely to weigh on Gold.

Technical Comments

1. Price is capped by the 20EMA which is hinting at a bearish price trend

2. MACD is hinting at a bearish price trend.



Key Levels

Support1980.951966.001949.65
Resistance1998.852011.702022.65










Technical Overview

USD/JPY – Price reached a high of 134.70 on Tuesday morning but this high was accompanied by a divergence warning from the MACD indicator, hinting at a possible price high. A Spinning top candlestick price pattern is also hinting at a possible price high and a reversal ahead. Stochastic is hinting at a price decline but both MACD and 20EMA are hinting at a bullish price trend. We are expecting a rally to test the 134.70 in the next 24 hours before the decline kicks in.

Support133.95133.35132.85
Resistance134.70135.10135.80

EUR/USD – Price reached a low of 1.0908 on Monday and we have seen a rally to 1.0983. However, the rally is capped by the 20EMA and we could see a decline to 1.0865 in the next 24 hours. MACD is hinting at a price decline. 20EMA is also hinting at a price decline. However, Stochastic is hinting at a price rally. We think price is likely to be capped by the 20EMA and we see a decline to 1.0865.

Support1.09401.09051.0865
Resistance1.09851.10201.1075

GBP/USD – We had a sell order which was filled at 1.2435 when price reached a high of 1.2449 overnight. Our view remains unchanged from yesterday and we are looking at a price move to 1.2285 in the next 48 hours. Stochastic is rising but both MACD and 20EMA are hinting at a bearish price trend. We recommend keeping stop at 1.2475 and profit target unchanged at 1.2285.

Support1.24051.23551.2305
Resistance1.24501.25051.2545

USD/CAD – Price had reached a low at 1.3299 last week and we have seen a rally to 1.3419 yesterday. The rally was capped by the previous low turned resistance. If price is unable to move above this resistance, we are likely to see a decline to 1.3299. A move above 1.3420 would hints at a move to 1.3455. All 3 technical indicators, MACD, stochastic and 20EMA are all hinting at a price rally.

Support1.33601.33001.3260
Resistance1.34201.34551.3490

AUD/USD – The rally off the low at 0.6680 was capped by the Fibonacci 50% of the decline from 0.6805 to 0.6680. If price is unable to move above this resistance, we are likely to see a decline to 0.6615 in the next 48 hours. Stochastic is hinting at a price rally but both MACD and 20EMA are hinting at a price decline. A move above 0.6760 would negate our bearish view and hints at a rally to 0.6805.

Support0.66950.66450.6615
Resistance0.67450.67800.6810

FX Commentary – U.S. Dollar Dipped Ahead of Inflation Data

Nicholas

Market Talk
– The U.S. dollar dipped on Wednesday against major currencies as investors waited on inflation data later in the global day for further signs of whether price pressures are ebbing and what it means for further Federal Reserve interest rate hikes.

– The euro was last 0.12% higher at $1.0926 boosted by a rise in European bond yields on Tuesday. Sterling rose 0.02% to $1.2430, with both currencies some distance away from their one-week lows hit on Monday.

– Against the yen, the dollar rose to a nearly one-month high of 134.04, a reflection of the stark contrast between the Fed’s aggressive monetary policy tightening cycle and the Bank of Japan’s ultra-loose policy.

– The Australian and New Zealand dollars were mostly steady on Wednesday. The Aussie edged 0.2% higher to $0.6664 while the kiwi dollar was up 0.1% at $0.6198, having dropped 0.4% to as far as $0.6185 overnight, a three-week low.

– Gold jumped 0.5% to $2,013.33 an ounce on Wednesday, boosted by safe haven buying after Minneapolis Federal Reserve President Neel Kashkari flagged a potential recession this year, with focus also turning to more U.S. economic cues due later in the day.

Chart Focus AUD/USD

Key Points

1. Buy AUD/USD recommendation.

2. Buy AUD/USD at 0.6650. Stop at 0.6620 and profit target at 0.6725

3. Dovish Fed comments and an agreement with China to resolve dispute over barley imports have helped to improve sentiment for the Aussie dollar.

4. Price may have reached a temporary bottom with stochastic and MACD warning of a potential price low and a price rally ahead.

Fundamental Comments

1. Overnight dovish Fed officials’ comments are weighing on the US dollar

2. An agreement with China to resolve dispute over barley imports has helped to improve sentiment for the Aussie dollar,

Technical Comments

1. Price may have reached a temporary bottom with a technical bounce likely.

2. Stochastic and MACD are warning of a potential price low and a price rally ahead.



Key Levels

Support0.66500.66150.6585
Resistance0.66850.67250.6760










Technical Overview

USD/JPY – Yesterday, we had recommended buying at 133.00, which was filled when price declined to a low of 132.96. Overnight, price has moved up to a high of 134.03. We are expecting the rally to continue higher to 134.60 in the next 24 hours. Stochastic is in the overbought zone, hinting at a limited upside. Both MACD and 20EMA are hinting at a bullish price trend. We would recommend lifting stop to cost while keeping profit target at 134.60.

Support133.70133.15132.70
Resistance134.40134.85135.15

EUR/USD – Price was capped by a previous high resistance at 10935 this morning and we may see a tight range ahead of CPI data later tonight. The next direction is likely to be set by the CPI data tonight. Stochastic is supporting a price decline while 20EMA is hinting at a price rally. MACD is neural at the moment. If price can move above 1.0935, we could see a test of 1.1035. Failure to move above 1.0935 could send price lower to 1.0830.

Support1.08951.08301.0785
Resistance1.09351.09751.1035

GBP/USD – Price reached a low of 1.2343 on Monday and we have seen a recovery to 1.2455. We are likely to see a tight range ahead of CPI data. Both MACD and 20EMA are hinting at a sideways range while stochastic is hinting at price decline. We think the US data tonight is likely to determine the next directional move. If price is capped at 1.2450, we are likely to see a decline back to 1.2345. However, if price can move above 1.2450 we are likely to see a rally to test the previous high at 1.2525.

Support1.24001.23401.2275
Resistance1.24551.25251.2595

XAU/USD – We have seen a price rally from Monday’s low of $1981.58 to a high of $2021.15 this morning. This high is also a previous price high. Stochastic is hinting at a continuation of this price rally. 20EMA is supporting stochastic view while MACD is neutral at the moment. We think price may have reached a correction high and a decline back to $1981 is likely. A move above $2021 would hint at a rally towards $2074.

Support2006.901987.551976.80
Resistance2021.152031.852049.60

NZD/USD – After reaching a low of 0.6167 this morning, we saw a rally towards the 20EMA line, but this rally failed to move above the 20EMA line. We are likely to see a price decline below this morning low of 0.6167 to 0.6135 in the next 24 hours to establish a low. Stochastic is hinting at a possible price low. However both MACD and 20EMA are hinting at a bearish price trend.

Support0.61700.61350.6085
Resistance0.62050.62500.6305

FX Commentary – Greenback Paused After A Sharp Rally Over Easter Holiday

Nicholas

Market Talk
– The U.S. dollar paused for breath after an overnight rally on Tuesday, following its best rally this month against major peers as a resilient U.S. labour market bolstered the case for a Federal Reserve rate hike next month.

– The Japanese yen managed to claw back some of Monday’s more than 1% slide, as the 10-year Treasury yield also slowed down in Tokyo trading after a sharp two-day climb. The yen came under additional pressure overnight as the new Bank of Japan governor, Kazuo Ueda, vowed to stick with ultra-easy stimulus setting for the time being.

– The euro fell 0.36% to $1.0859 after dropping to $1.0831, the lowest since April 3. Sterling ticked up 0.11% to $1.2397 after a 0.23% overnight decline. The Swiss francs were little changed at 0.9060.

– The Australian dollar fell 0.51% to $0.6674, after earlier hitting $0.6619, the lowest since March 16, and the kiwi dropped 1.01% to $0.6211, after earlier reaching $0.6195, the lowest since March 27.

– Gold prices hovered just below recent highs on Tuesday, remaining relatively underpinned as markets awaited more cues on the U.S. economy from inflation data and the minutes of the Federal Reserve’s March meeting due later this week.


Chart Focus USD/JPY

Key Points

1. Buy USD/JPY recommendation.

2. Buy USD/JPY at 133.00. Stop at 132.70 and profit target at 134.60.

3. An increase in US Treasury yields and interest rate differential are both against the yen

4. Price is likely to be supported by the 20EMA line with MACD hinting at a bullish price trend.

Fundamental Comments

1. An increase in US Treasury yields is likely to weigh on the Japanese yen.

2. Interest rate differential is in the US dollar favour

Technical Comments

1. Price is likely to be supported by the bullish 20EMA line.

2. MACD remains bullish and is hinting at a bullish price trend.



Key Levels

Support133.15132.70132.10
Resistance133.70134.40134.85











Technical Overview

USD/CHF – Price has reached a high of 0.9119 on Monday and we think price has reached a high and we are likely to see a continuation of the decline to 0.9000 again in the next couple of days. Stochastic is hinting at a price decline. MACD is also hinting at a price decline. The 20EMA line is bearish and hinting at a bearish price trend. Only a move above 0.9120 would negate our bearish view and calls for a test of 0.9190.

Support0.90400.90000.8965
Resistance0.90800.91200.9185

EUR/USD – Price reached a low of 1.0830 overnight and we have seen a recovery to a high of 1.0897 this morning. If price is capped by the 20EMA at 1.0897, we are likely to see a decline back to 1.0830. However, if price can move above 1.0897, we are likely to see a rally to test the previous high at 1.0965. Stochastic is suggesting a price rally. MACD is supporting stochastic but 20EMA is hinting at a price decline.

Support1.08551.08201.0785
Resistance1.09001.09351.0975

GBP/USD – Price reached a low of 1.2343 on Monday and we have seen a recovery to 1.2419 at the point of this writing. If price is capped at 1.2420, we are likely to see a decline back to 1.2345. However, if price can move above 1.2420 we are likely to see a rally to test the previous high at 1.2525. Stochastic is suggesting a price rally. MACD is supporting stochastic but 20EMA is hinting at a price decline.

Support1.23801.23401.2375
Resistance1.24251.24701.2525

XAU/USD – Price had reached a high of 2032.16 last Wednesday and we have seen a price decline to 1981.58 yesterday. Stochastic is hinting that price can move above the 20EMA line at $1999.20 to a high of $2020 in the next couple of days. MACD is also supporting this view. However, 20EMA is hinting that price is likely to decline lower. We think price could move higher to $2020 in the next few days.

Support1981.601966.001949.65
Resistance2002.902020.402032.15

AUD/USD – Price is currently capped by the 20EMA line at 0.6655. Stochastic is hinting at a price rally but both MACD and 20EMA are hinting at a price decline in the next 48 hours. We think price is likely to decline back to test the overnight low at 0.6618 in the next 48 hours. However, a price move above 0.6690 would negate our bearish view and call for a rally to 0.6705.

Support0.66450.66150.6565
Resistance0.66850.67250.6775

FX Commentary – US Dollar Stumbled On Weak ISM Data

Nicholas

Market Talk
– The U.S. dollar stumbled on Monday, surrendering earlier gains following unexpected oil output cuts from OPEC+, as data showed the U.S. economy continued to slow with declines in manufacturing and construction spending.

– Data on Monday added to the narrative that the Federal Reserve is near the end of its rate-hike cycle. The Institute for Supply Management data on Monday showed that manufacturing activity fell to the lowest in nearly three years in March as new orders continued to contract, with all sub-components of its manufacturing PMI below the 50 threshold for the first time since 2009.

– The euro fell to $1.0890, having gained more than 0.5% on Monday. Against the Japanese yen, the dollar rose 0.28% to 132.83. Sterling firmed 0.8% at $1.2422, while the dollar dipped 0.% against the Swiss franc to 0.912 francs.

– The Australian dollar slipped to 0.6770 on Tuesday after the Reserve Bank of Australia left its cash rate unchanged at 3.60%, as expected, with policymakers saying additional time was needed to “assess the impact of the increase in interest rates to date and the economic outlook”.

–  Gold prices fell slightly $1978 on Tuesday after rallying back to key levels in the prior session as markets considered the potential for more economic turmoil this year amid a manufacturing slowdown and rising fuel costs.


Chart Focus EUR/JPY

Key Points

1. Buy EUR/JPY recommendation.

2. Buy EUR/JPY at 144.40. Stop at 144.10 and profit target at 145.60.

3. Divergent monetary policy and interest rate differential are both in the Euro interest.

4. Price is supported by the 20EMA with MACD hinting at a bullish price trend.

Fundamental Comments

1. Divergent monetary policy is in the Euro’s favour.

2. Interest rate differential is in the Euro’s favour

Technical Comments

1. Price is supported by the 20EMA which is also hinting at a bullish price trend.

2. MACD remains bullish and is hinting at a bullish price trend.










Technical Overview

USD/JPY – Price had reached a high of 133.75 on Monday and that high was accompanied by a divergence warning from the MACD indicator, hinting at a possible price high. We are likely to see a price decline back to the Fibonacci 50% correction point of the rally at 132.15 over the next few days. Stochastic is also hinting at a price decline, 20EMA remains neutral. A price move above 133.75 would negate our bearish price view.

Support132.55132.10131.70
Resistance133.10133.70134.35

EUR/USD – Price remains nears a 5-week high at 1.0929 and looks likely to test the high again the next couple of days. 20EMA is hinting at a bullish price trend. MACD remains bullish and is hinting at a price rally. Stochastic is moving higher and is hinting at a price rally. A move above 1.0930 is likely to send price higher to 1.1032. A move below 1.0785 would negate our bullish price view.

Support1.08801.08451.0790
Resistance1.09251.09851.1035

GBP/USD – Price has moved above the previous week’s high at 1.2422 and looks like it will continue higher to 1.2595 in the next few days. 20EMA is pointing to a bullish price trend. Stochastic is also hinting at a continuation of this current rally. MACD is bullish and is hinting at a bullish price trend. Only a move below the 20EMA at 1.2365 would negate our bullish price view for the next few days.

Support1.23951.23351.2270
Resistance1.24501.25151.2575

XAU/USD – Price is consolidation in a big triangle chart pattern at the moment after reaching a high at $2009.75. Both MACD and Stochastic confirm the consolidation triangle chart outlook. 20EMA is neutral at the moment. We would prefer to see a break on the topside for a test to $2078 in the next few weeks. For the short term, watch out for the boundaries at $1991 and the downside at $1943. A break above would confirm our bullish view while a move below the lower boundary would negate our bullish view.

Support1973.101959.501943.85
Resistance1987.551999.552009.75

AUD/USD – A pause by the RBA in rate hike has brought the Aussie dollar down to 0.6755 from a high of 0.6793 earlier in the day before the RBA announcement. Stochastic is in the overbought zone and is hinting at a limited upside. MACD remains bullish and is hinting at a bullish price trend. 20EMA is also bullish. We think the correction should be supported at the 20EMA line at 0.6730 and from there we see another rally to 0.6850.

Support0.67450.67150.6665
Resistance0.67950.68500.6895