Tag: AUD/USD

FX Commentary – US Dollar Gained On US PCE Inflation Data

Nicholas

Market Talk
– The U.S. dollar was on the front foot on Monday, hovering near a seven-week peak after a slew of strong U.S. economic data reinforced the view that the Federal Reserve will have to raise interest rates further and for a longer.

– U.S. spending and inflation data on Friday depicted a U.S economy running too hot at the start of the year, increasing the urgency for the Fed to tighten further over coming months. The PCE price index shot up 0.6% last month after gaining 0.2% in December, while consumer spending was 1.8% last month.

– The euro was up 0.08% to $1.0554 on Monday morning, coming off the seven week low it hit on Friday. Sterling was last trading at $1.1959, up 0.13% on the day. The Japanese yen strengthened 0.15% to 136.26 per dollar, having slipped to more than two month lows of 136.58 earlier in the session.

– The Aussie was hovering at $0.6732, having plunged 1.2% on Friday as far as $0.6719, the lowest since Jan. The kiwi dollar was reeling at $0.6165, after tumbling 1.0% the previous session to as low as $0.6153, the weakest since late November.

– Gold prices were muted on Monday, hovering around a two-month low at $1811.37 an ounce amid concerns over high U.S. inflation and a hawkish response from the Federal Reserve after US data gave the central bank more impetus to keep hiking rates.


Chart Focus AUD/JPY

Key Points

1. Buy AUD/JPY recommendation.

2. Buy AUD/JPY at 91.15. Stop at 90.85 and profit target at 91.95.

3. A higher peak in Aussie cash rate and interest rate differential are both aiding the Aussie dollar.

4. Price is likely to find support at a previous low with stochastic and MACD both hinting at a possible price low.

Fundamental Comments

1. Strong Aussie data is hinting at a higher peak in Aussie cash rate, which is likely to aid the Aussie dollar.

2. Interest rate differential is in the Aussie dollar favour, aiding the Aussie dollar.

Technical Comments

1. Price is likely to find support at the previous low support.

2. Stochastic and MACD indicators are hinting at a possible price low in the making.



Key Levels

Support91.1590.8590.45
Resistance91.8592.2592.65










Technical Overview

USD/JPY – Price reached a high of 136.55 this morning despite earlier divergence warnings from the MACD indicator. Stochastic is hinting that price can continue to move higher. 20EMA is hinting at a bullish price trend. Price is likely to find support at 135.35 and we could see another test of this morning’s high at 136.55. Price could even move up to 137.45 in the next 48 hours. A move below 135.35 would negate our bullish view.

Support135.95135.35134.75
Resistance136.55136.90137.35

EUR/USD – Price continued its decline to a low of 1.0535 last Friday, despite earlier warning of divergences from the MACD indicator. MACD and 20EMA are both hinting at a continuation of this decline. Stochastic is hinting at a limited downside. Price may do a mini corrective rally towards the 20EMA at 1.0590 and from there we could see another decline to 1.0490 in the next few days.

Support1.05351.04901.0445
Resistance1.05751.06101.0665

GBP/USD – We have a sell call at 1.2035 last Friday which was filled when price moved up to a high of 1.2041. Price had declined to a low of 1.1928 on Friday just below our profit target at 1.1930. Both MACD and 20EMA are hinting at a continuation of the decline to test 1.1914. We think price is likely to test this support as well. The next direction is likely to be decided by the reaction at 1.1914.

Support1.19101.18651.1810
Resistance1.19651.20051.2075

XAU/USD – Price reached a low of $1808.55 last Friday and the decline continues with price reaching a low of $1806.30 at the point of this writing. MACD and 20EMA are both hinting that price will continue to decline. Stochastic is hinting at a limited downside. As long as price stays below 20EMA at $1822, we see price declining to $1787.90(Fibonacci 50% correction) in the next few days.

Support1803.701791.101783.90
Resistance1820.701834.501847.55

AUD/USD – Price failed to move above the falling 20EMA line at 0.6380 last Friday and we saw a decline in price lower to 0.6700 at the point of this writing. MACD and 20EMA are both hinting at a continuation of this decline. Stochastic is hinting at a limited downside. We are expecting this decline to continue lower to 0.6645 which is the Fibonacci 50% correction point of the rally from 0.6170 to 0.7156.

Support0.66950.66450.6580
Resistance0.67400.67800.6825

FX Commentary – US Dollar Bolstered By Strong Economic Data

Nicholas

Market Talk
– The US dollar clung to modest gains against its major peers on Thursday, bolstered by strong economic data that continues to suggest the U.S. Federal Reserve’s monetary policy tightening could be extended if it is to bring down the highest inflation in decades.

– On Thursday, the Labour Department said the number of Americans filing new claims for unemployment benefits unexpectedly fell last week, reflecting tight labour market conditions while U.S. GDP increased 2.7% in the fourth quarter showing the economy grew solidly in the fourth quarter.

– The euro reached a low of $1.0576 in late New York trading while Sterling also eased to $1.1991. The yen was last trading at 134.66, as the incoming head of Japan’s central bank soothed fears of an early end to super-easy monetary policy, nudging bond yields lower globally.

– The Aussie nudged back up to $0.6822, after touching a trough of $0.6783 overnight. The kiwi dollar rose to $0.6236, benefiting from a steep rise in domestic bond yields. The RBNZ had raised interest rate by 50 basis points on Wednesday.

– Gold prices rose slightly on Friday to $1823.84, but were set for a fourth consecutive week of decline amid growing uncertainty over U.S. monetary policy. Investors are waiting for more cues from the Core PCE Price Index, a reading on the Federal Reserve’s preferred inflation gauge, later in the day.


Chart Focus GBP/USD

Key Points

1. Sell GBP/USD recommendation.

2. Sell GBP/USD at 1.2035. Stop at 1.2075 and profit target at 1.1930

3. Strong U.S. economic data continues to suggest the Federal Reserve’s monetary policy tightening could be extended and interest rate differential are both aiding the U.S. dollar.

4. Price is likely to be capped by the Fibonacci 50% correction point and the 20EMA with MACD hinting at a bearish price trend.

Fundamental Comments

1. Strong U.S. economic data continues to suggest the Federal Reserve’s monetary policy tightening could be extended is aiding the US dollar.

2. Interest rate differential is in the U.S. dollar favour.

Technical Comments

1. Price is likely to be capped by the Fibonacci 50% correction point and the 20EMA.

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



Key Levels

Support1.19901.19601.1910
Resistance1.20351.20751.2145










Technical Overview

USD/JPY – Price reached a high of 135.22 on Tuesday and seems to have lost its upward momentum. We saw a price decline to 134.07 this morning and we are expecting the decline to continue lower to 133.60 in the next 24 hours. The 20EMA line at 134.65 is likely to cap any rally. Currently, the stochastic, the MACD and 20EMA are all hinting at a price decline. Above 134.95 would negate our bearish price view.

Support134.50134.05133.60
Resistance134.90135.25135.95

EUR/USD – Price reached a new low at 1.0576 overnight and again there was a divergence warning from the MACD hinting at a possible price low. Stochastic is also hinting at a possible price low but 20EMA is still hinting at a price decline. We think the price decline is likely to be limited and we are looking at a price rally to 1.0665 in the next 48 hours.

Support1.05751.05401.0485
Resistance1.06151.06651.0705

USD/CAD – Price reached a high of 1.3580 on Thursday but this high was accompanied by divergence warnings from both the stochastic and MACD indicators, hinting at a possible price high. 20EMA is hinting at a bullish price trend but we think price may have reached a high. If price falls below the 1.3525, we are likely to see price 1.3440 in the next few days ahead.

Support1.35401.35001.3460
Resistance1.35801.36201.3665

XAU/USD – We had a buy recommendation yesterday at $1825.50. However price went below our stop at $1818.00 to a low of $1817.43, triggering our stop order. Stochastic and MACD are both hinting at a possible price low and a price rally ahead. 20EMA remains bearish and is hinting at a bearish price trend. We are expecting price to stay above the previous day’s low and move higher to $1847.55 in the next few days.

Support1817.451803.701791.10
Resistance1827.751838.701847.45

AUD/USD – Price reached a low of 0.6780 overnight and this low was accompanied by a divergence warning from the MACD indicator, hinting at a possible price low. Stochastic is also hinging at possible price low but 20EMA is hinting at a bearish price trend. We favour a price rally to 0.6920 in the next 72 hours. However, failure to move above the falling 20EMA line at 0.6380 is likely to send price lower to 0.6750 in the next 24 hours.

Support0.67800.67500.6715
Resistance0.68250.68650.6900

FX Commentary – US Dollar Gained On February’s FOMC Meeting Minutes.

Nicholas

Market Talk
– The US dollar strengthened on Wednesday after U.S. Federal Reserve meeting minutes from the Federal Reserve’s February meeting added to expectations that further rate hikes are in the pipeline to squeeze inflation.  Minutes showed the Federal Reserve intents to use a slower pace of interest-rate hikes to tame persistently high inflation going forward.

– The minutes from the Fed’s Jan. 31 to Feb. 1 meeting said most of the officials supported the quarter-point increase because a slower pace “would better allow them to assess the economy’s progress” toward reducing inflation to their 2% target. But “a few” participants outright favoured a larger 50 bps increase at the meeting.

– The Aussie edged up 0.4% to $0.6833, recouping some of the 0.7% loss overnight to as low as $0.6795. The kiwi was also up 0.4% at $0.6247 as a hawkish Reserve Bank of New Zealand, which delivered a half-point hike a day before, offset fears tied to the Fed rate outlook.

– Sterling slipped down 0.58% to $1.2036, while the euro fell 0.44% to $1.0600. The Canadian dollar was lower against the greenback, dragged down by crude oil price, which declined to a 1-week low in the previous day.

– Gold prices moved little on Thursday at $1827.95, but were nursing losses for the week as the dollar hit a six-week high on fears of a hawkish Federal Reserve, with focus now turning to upcoming economic data for more cues on the U.S. economy and monetary policy.


Chart Focus XAU/USD – Gold

Key Points

1. Buy Gold recommendation.

2. Buy Gold at $1825.50. Stop at $1818.00 and profit target at $1847.50.

3. A stubborn US inflation could aid Gold as a hedge against inflation as the pace of interest rate slows.

4. Price has managed to bounce off a recent low, hinting at a strong price support and stochastic is hinting at a price rally ahead.

Fundamental Comments

1. The decline may have priced in the next Fed hike in March.

2. A stubborn US inflation could aid Gold as a hedge against inflation.

Technical Comments

1. Price has managed to bounce off a recent low, hinting at a strong price support.

2. Stochastic is hinting at a price rally ahead.



Key Levels

Support1829.601818.851803.70
Resistance1838.701847.451860.00










Technical Overview

USD/JPY – Price reached a high of 135.22 on Tuesday and seems to have lost its upward momentum. Price has been moving in a sideways manner for the past 48 hours. Stochastic and MACD are also hinting at a sideways movement. 20EMA is hinting at a price rally. We think price may have reached a temporary high and a price correction lower to 133.60 is likely in the next 48 hours.

Support134.55134.05133.60
Resistance134.95135.25135.95

EUR/USD – Price continues its decline and reached a low of 1.0598 overnight. However this low was accompanied by a divergence warning from the MACD indicator, hinting at a possible price low. As this is the second divergence warning, the chance of a turnaround in price is higher. We see price moving higher to 1.0705 in the next 48 hours. Stochastic and MACD are hinting at a price rally but 20EMA is still hinting at a bearish price trend.

Support1.05951.05401.0485
Resistance1.06351.06901.0725

GBP/USD – Yesterday we had a sell call at 1.2120, which was filled when price reached a high of 1.2127. Price had declined overnight to a low of 1.2033 and our profit order was filled. We are out of this position with a 70 pips profit. 20EMA is hinting at a price decline but MACD and stochastic are both hinting at a price rally ahead. Fibonacci ratio is also hinting that the price decline may be over. We think price may move higher to 1.2145 and above in the next 24 hours.

Support1.20301.19951.1955
Resistance1.20801.21201.2160

XAG/USD – Price reached a new weekly low at $21.43 overnight but this low was higher than the previous week’s low at $21.17. This could be a hint that the current decline is just a correction and we are likely to see a rally to $21.95 in the next 24 hours. We could also see a price move to $22.30 in the next few days. Stochastic and MACD are confirming the rising price trend but 20EMA remains bearish.

Support21.4521.1520.80
Resistance21.7022.0022.30

AUD/USD – Price reached a low of 0.6794 overnight and this low was accompanied by a divergence warning from the MACD indicator, hinting at a possible price low. A bullish Engulfing candlestick price pattern is also hinting at a possible price low. Stochastic is hinting at a rising price trend but 20EMA is hinting at a bearish price trend. We favour a price rally to 0.6920 in the next 72 hours.

Support0.67950.67500.6715
Resistance0.68400.68850.6935

FX Commentary – US Dollar Stayed Strong On Expectation of Higher Fed’s Peak Rate.

Nicholas

Market Talk
– The U.S. dollar was on the front foot on Monday, supported by a strong run of economic data out of the United States that traders bet, will keep the Federal Reserve on its monetary policy tightening path for longer than initially expected.

– A slew of data out of the world’s largest economy in recent weeks pointing to a still-tight labour market, sticky inflation, robust retail sales growth and higher monthly producer prices, have raised market expectations that the U.S. central bank has more to do in taming inflation, and that interest rates would have to go higher.

– Geopolitical tensions were ever present with North Korea firing more missiles and talk of Russia ramping up attacks in Ukraine before Friday’s one- year anniversary of the invasion, sending the Aussie lower to $0.6866. The kiwi slipped 0.17% to $0.6232, with eyes on the Reserve Bank of New Zealand’s interest rate decision on Wednesday.

– The euro was stuck at $1.0676, having touched a six-week low of $1.0613 on Friday.  The Euro was supported by two European Central Bank policymakers said on Friday that interest rates in the euro zone still have some way to rise, pushing up market pricing for the peak ECB rate.

– Gold prices hovered around a six-week low on Monday, moving little as traders awaited more cues on U.S. monetary policy from a slew of Federal Reserve speakers this week, as well as the minutes of the central bank’s February meeting.


Chart Focus EUR/USD

Key Points

1. Buy EUR/USD recommendation.

2. Buy EUR/USD at 1.0685. Stop at 1.0655 and profit target at 1.0785.

3. Hawkish remarks from ECB officials and an increase in peak ECB rate are aiding the euro dollar.

4. Price had moved off the low with bullish candlestick patterns, hinting at a price rally, with MACD hinting at a possible price low.

Fundamental Comments

1. Hawkish remarks from ECB officials are aiding the euro dollar.

2. An increase in the peak ECB rate is likely to hint at a narrow of interest rate differential, which is likely to aid the euro.

Technical Comments

1. Price had moved off the low with bullish candlestick patterns, hinting at a price rally.

2. MACD had a divergence warning, hinting at a possible price low.



Key Levels

Support1.06601.06101.0570
Resistance1.07051.07551.0790

Technical Overview

USD/JPY – Price reached a high of 135.10 last Friday, exceeding our target of 134.75. However, this high was accompanied by a divergence warning from the MACD indicator, hinting at a possible price high. Stochastic is also hinting at a price decline ahead but 20EMA is hinting at a bullish price trend. We think that price has peaked and is likely to decline lower to the 132.90 in the next 48 hours.

Support133.90133.55132.95
Resistance134.50134.80135.10

USD/CHF – Price reached a high of 0.9331 last Friday and has declined back to the 20EMA support area at 0.9250. If price can stay above 0.9250, we are likely to see another rally to 0.9330. However, if price stay below 0.9250, we are likely to see a decline to 0.9160 in the next 48 hours. Stochastic and 20EMA are both hinting at a price decline while MACD is hinting at a rally to 0.9330. We prefer to see a decline to 0.9160.

Support0.92100.91800.9135
Resistance0.92550.92900.9330

GBP/USD – Price reached a low of 1.1914 last Friday but this low was accompanied by a divergence warning from the MACD indicator, hinting at a possible price low.  Price has since rallied and had reached a high of 1.2045 this morning. Stochastic is hinting at a continuation of this price rally. We think the rally can continue up to 1.2120 in the next 48 hours. Only a move below 1.1914 would negate our bullish price view.

Support1.20151.19601.1915
Resistance1.20701.21201.2175

XAU/USD – Price reached a low of $1818.85 last Friday and this could be a temporary low. MACD has also given a divergence warning of a possible price low. Stochastic and 20EMA are supporting this view as well. Price is currently testing an important resistance. If price can move above $1845.10, we are likely to see a rally to $1865. However, a failure to move above this resistance would likely result in a decline to test the previous low at $1818.85.

Support1837.201826.401818.85
Resistance1849.801865.801879.15

AUD/USD – Price reached a low of 0.6810 last Friday and this low was accompanied by a divergence warning from the MACD indicator, hinting at a possible price low. Stochastic and 20EMA are both hinting at a price rally. MACD is hinting at a price decline ahead. We favour a rally to 0.6980 in the next 48 hours. Only a move below 0.6810 would negate our bullish view for the next 48 hours.

Support0.68850.68550.6810
Resistance0.69350.69750.7025

FX Commentary – US Dollar Surged Bets On Prolong Fed Tightening.

Nicholas

Market Talk
– The U.S. dollar hovered near a five-week high against major peers on Monday on rising bets for prolonged Federal Reserve policy tightening ahead of a crucial consumer price report that is scheduled for Tuesday at 8.30pm New York time.

– The yen slipped with the government set to nominate a candidate who backs the current policy settings as the new Bank of Japan governor on Tuesday. The Japanese yen slipped to a low of 132.20 on Monday morning in Asian trading.

– The euro eased 0.06% to $1.0669 on Friday and continues its decline on Monday morning to a low of $1.0654. The British pound was last trading at $1.2044, down 0.12% on the day and below the low of last Friday.

– The risk-sensitive Australian and New Zealand dollars eased with Asian equities on worries that higher U.S. rates will choke global growth. The Aussie fell 0.13% to $0.6910, having been largely flat in the previous week.  The New Zealand’s kiwi lost 0.08% to $0.6306.

– A rally in gold prices, which started in the beginning of the year, cooled over the past two weeks as markets reassessed their outlook for U.S. monetary policy and awaited more cues on the U.S. economy from key inflation data due this week.

Chart Focus GBP/USD

Key Points

1. Sell GBP/USD recommendation.

2. Sell GBP/USD at 1.2075. Stop at 1.2110 and profit target at 1.1965.

3. Rising bets for a prolonged Federal Reserve policy tightening and a higher US bond yields are both aiding the US dollar.

4. Price has moved below the 20EMA, with both the MACD and 20EMA hinting at a bearish price trend.

Fundamental Comments

1. Rising bets for a prolonged Federal Reserve policy tightening is aiding the U.S. dollar.

2. A higher US bond yields is also aiding the US dollar.

Technical Comments

1. Price has moved below the 20EMA, which is hinting at a bearish price trend.

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



Key Levels

Support1.20051.19601.1920
Resistance1.20651.21101.2140










Technical Overview

USD/JPY – Price reached a low of 129.80 and we have seen a bounce back up to a high of 132.20 at the point of this writing. Both MACD and 20EMA are pointing up, hinting that price is likely to go higher. Stochastic is also hinting that price has room to go higher. The choice of the new BOJ governor is also likely to see yen weaken. We see price testing its previous high of 132.90 in the next 48 hours.

Support132.25131.70131.30
Resistance132.90133.35134.05

EUR/USD – Price reached a new low of 1.0654 this morning. However this new low was accompanied by a divergence warning from the MACD indicator, hinting at a possible price low. Stochastic is also hinting that price is near to its low. The 20EMA is hinting at a bearish price trend.  We think price may have reached a low and is likely to move up to 1.0785 again in the next few days. A move below 1.0654 would negate our bullish view.

Support1.06501.06201.0585
Resistance1.06951.07451.0795

USD/CHF – Price was capped by the 20EMA and declined to a low of 0.9159 on Thursday. Since this low, price has recovered and has reached a high of 0.9259 this morning.  We are likely to see a continuation of the rally to 0.9290 in the next 24 hours. The next direction will depend on the reaction at the 0.9290 high. Stochastic, 20EMA and MACD are hinting that the rally might not be able to move above the next resistance.

Support0.92200.91600.9120
Resistance0.92500.92900.9355

XAU/USD – We had a buy call on last Friday at $1858 after price declined to a low of $1852.68. Both MACD and 20EMA are hinting at a continuation of the price decline. MACD is also turning down and below the zero line, hinting at a price decline. Stochastic is hinting that price may have reached a bottom. We would recommend keeping stop at $1851 and profit order at $1885. There is a risk that our stop may be hit today.

Support1852.651843.551831.40
Resistance1868.551878.701890.15

AUD/USD – Fibonacci ratio is hinting that price is likely to move lower to 0.6850. Only a price move above 0.7045 will negate this bearish price view. 20EMA and MACD indicator are both supporting this bearish view. Both are hinting at a price decline as well. However, Stochastic is hinting at a price movement higher. We favour the bearish move as suggested by the trend indicators.

Support0.68850.68550.6790
Resistance0.69300.69700.7010