Tag: GBP/SGD

FX Commentary – US Dollar Rose On Labour Data That Could Lead To More Aggressive Rate Path

Nicholas

Market Talk
– The U.S. dollar rose for the fourth time in the past five sessions, as economic data on the labour market helped firm expectations the U.S. Federal Reserve will be more aggressive in taking steps to curb inflation.

– After touching a six-year low of 122.44 per dollar on Friday morning, by the Tokyo afternoon the yen had snapped a five-day losing streak and was up as far at 1% to 121.18 after the BoJ seemed in no rush to counter an increase in Japanese bond yields. 

– The Aussie dollar was steady at $0.7523, just a fraction below an overnight four-month high of $0.7527. Australia is an exporter of energy and agricultural commodities, where supplies have been disrupted by the conflict in Ukraine, sending the Aussie dollar higher.

– The euro has been hurt by the same commodity price moves, and though it managed a 0.3% lift in the Asia session. Sterling nudged higher to $1.3221 as traders weigh a cautiously dovish outlook from the BoE against February data that showed higher-than-expected inflation.

– Gold rose to a more than one-week high as concerns over soaring prices and uncertainty surrounding the war in Ukraine lifted bullion’s appeal as a safe -haven and an inflation hedge but a rise in US benchmark 10-Year Treasury yield capped the yellow metal’s gain.


Chart Focus GBP/USD

Key Points

1. Buy GBP/USD recommendation.

2. Buy GBP/USD at 1.3205. Stop at 1.3175 and profit target at 1.3310

3. Higher UK inflation and interest rate differential are both likely to aid the British pound.

4. Price is supported by a strong support with MACD hinting at a bullish price trend.

Fundamental Comments

1.  Higher-than-expected inflation in February is likely to prompt the BoE to hike interest rate aiding the pound.

2. Interest rate differential is in the British pound’s favour.

Technical Comments

1. Price is supported by the 20EMA as well as a rising trend channel.

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



Key Levels

Support1.31951.31551.3100
Resistance1.32401.32951.3335

Technical Overview

USD/JPY – Price broke above the resistance 121.41 and reached a high of 122.44 this morning. This was followed by a swift decline to 121.17. However, MACD remains bullish and Stochastic is about to have a bullish crossover, hinting at a bullish price trend. 20EMA is currently capping price but we think price is likely to surpass the 20EMA and move higher again to 122.44 again within the next 48 hours.

Support121.60121.15120.80
Resistance122.05122.45123.05

EUR/USD – Price tested the low at 1.0965 on three separate occasions and has been able to hold above this support. The latest rally off this rally has reached a lower level compared to the other 2 previous attempts. Currently, MACD and 20EMA are both hinting at a bullish trend. However, if price is unable to move above the resistance at 1.1045, it is likely to test the low at 1.0965 again.

Support1.09951.09601.0925
Resistance1.10451.10901.1135

AUD/USD – Price reached a four-month high of $0.7536 this morning but this high could be in the form of a Rising Wedge chart pattern. This is a sign of a price high in the process of forming. Stochastic is also in the overbought zone but both MACD and 20EMA remain bullish. Price should continue to move higher but a break of the Rising Wedge’s trend line at 0.7490 would hint at a decline to 0.7375.

Support0.75000.74500.7415
Resistance0.75500.75800.7615

XAU/USD – Price reached a high of $1965.55 overnight which was also the Fibonacci 127% of the previous rally from the low of $1895.10 to $1949.65. If price is unable to move above this high, it could mean we have seen a price high and a decline back to $1895.10 is likely over the next few days. Stochastic is also in the overbought zone but 20EMA and MACD both remain bullish.

Support1952.601937.951925.20
Resistance1965.551974.551982.85

GBP/SGD – We had a buy call yesterday at 1.7910 with a stop at 1.7870 but price declined to a overnight low of 1.7861, triggering our stop. We are out of this position with a loss of 40 pips. However, our view remains unchanged. We are looking at price moving higher to 1.8010. MACD and 20EMA remain bullish supporting our view. Stochastic is close to the oversold zone and is hinting at a bullish price trend ahead.

Support1.78951.78601.7805
Resistance1.79351.79801.8030

FX Commentary – Gold Gained On Lower Treasury Yield and Ukraine Crisis

Nicholas

Market Talk
– The U.S. dollar was up on Thursday morning in Asia, as commodity currencies took a breather from a steep rally driven by rising prices for exports, while a recovery in the U.S. bond market offered little solace to the struggling yen.

– The yen hit a six-year low of 121.41 per dollar on Wednesday, and was pinned near that level at 121.25 in Thursday Asian morning trade as investors expect the Bank of Japan to lag way behind policy tightening by other major central banks fighting inflation.

– The Australian dollar held at $0.7494 after a brief trip above $0.75 overnight but remained just below multi-month peaks as commodity prices to a breather from a steep rally. The New Zealand dollar was 0.2% softer at $0.6960.

– Sterling slipped overnight and was marginally softer on Thursday at $1.3187 even though February inflation was a little hotter than expected while the euro traded at $1.0989 after a small overnight fall.

– Gold was up on Thursday morning in Asia as US Treasury yields fell by 9 basis points overnight. The intensifying Ukraine crisis also fed demand for the safe-haven yellow metal.

Chart Focus GBP/SGD

Key Points

1. Buy GBP/SGD recommendation.

2. Buy GBP/SGD at 1.7910. Stop at 1.7870 and profit target at 1.8010

3. Expectation of interest rate hike and interest rate differential are both in the British pound’s favour.

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

Fundamental Comments

1. Expectation of interest rate hike by the Bank of England is likely to aid the British pound.

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

Technical Comments

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

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



Key Levels

Support1.78951.78501.7805
Resistance1.79351.79801.8030

USD/JPY – Price is currently trying to break above the overnight high at 121.41 at the point of this writing. If price is able to move able this point, we are likely to see a test to first to 121.70, which the high from early 2016, before 122.05. However failure to move above 121.41, price is likely to decline to 120.45. Stochastic is in the overbought zone but both MACD and 20EMA are hinting at a strong bullish price trend.

Support121.00120.65120.25
Resistance121.45121.80122.05

EUR/USD – We had a buy call for this pair yesterday at 1.1025 but our call was wrong and we lost 35 pips on this trade. MACD has turned bearish and 20EMA is also hinting at a bearish price trend. However, Stochastic is hinting at a price rally. If price stays below the 20EMA line at 1.1015, we could be seeing a price decline to 1.0900 in the next couple of days.

Support1.09601.09251.0890
Resistance1.10051.10451.1090

GBP/USD – Price broke above 1.3210 on the third attempt and we have seen a rally to a high at 1.3298 on Wednesday but price has now declined to the support at 1.3210 to 1.3180. Currently, the 20EMA is supporting price at 1.3190. If price can stay above 1.3180, we are likely to see a test of the overnight high at 1.3298 as MACD remains bullish. Stochastic is also near to the oversold zone.

Support1.31801.31451.3090
Resistance1.32151.32501.3300

XAU/USD – Our view remains the same as yesterday. We see price moving within the range of $1949.65 to $1895.10 in the next couple of days until there is a breakout of this range. Yesterday, price tried the upper range of the band but was unable to move above $1949.65. Stochastic is in the overbought zone but both MACD and 20EMA remain bullish. Watch the range boundaries for clue to the next price direction

Support1935.201925.201910.70
Resistance1949.651961.251973.25

USD/CHF – We had a buy recommendation at 0.9305 on Monday and yesterday, we had recommended placing stop at cost at 0.9305 and profit order at 0.9395. Unfortunately, our stop was triggered and we are out of this position without a loss. MACD and 20EMA remain bearish but Stochastic is close to the oversold zone. If price is able to hold above 0.9290, a rally to 0.9430 is still possible. A move below 0.9290 would send price down to 0.9230.

Support0.92900.92500.9215
Resistance0.93350.93750.9415