Tag: USD/JPY

FX Commentary – Strong US Data Sent The Greenback Higher Against Its Peers

Nicholas

Market Talk
– The U.S. dollar eased on Tuesday after rallying overnight as strong U.S. economic data reinforced expectations that the Federal Reserve will hike interest rates again in May, while China’s economic recovery gathered pace in the first quarter.

– Confidence among single-family homebuilders improved for a fourth consecutive month in April, while manufacturing activity in New York State increased for the first time in five months. Recent hawkish comments from Fed officials saw markets pricing in a greater chance of a rate hike in May, and brewed uncertainty over whether the central bank will pause in June.

– The euro was at $1.09320, easing away from the one-year high of $1.1075 it touched last week. Sterling was last trading at $1.2381, on the day ahead of employment data that could potentially cause some volatility in the pound if the report shows that the labour market is not cooling.

– The Japanese yen weakened to 134.52 per dollar, hovering around the one-month peak of 134.57 it touched on Monday. The Australian dollar rose to $0.6720 after the minutes of the last Reserve Bank of Australia meeting showed that the central bank considered an 11th-consecutive rate hike in April before deciding to pause.

– Gold prices hovered below key levels in early Asian trade on Tuesday, coming under pressure from a firmer dollar and Treasury yields as markets reconsidered expectations for an imminent pause in the Federal Reserve’s interest rate hikes following recent strong US data and hawkish Fed officials’ comments.


Chart Focus GBP/USD

Key Points

1. Sell GBP/USD recommendation.

2. Sell GBP/USD at 1.2435. Stop at 1.2475 and profit target at 1.2285.

3. Strong US data and interest rate differential are both in the US dollar favour.

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

Fundamental Comments

1. Strong US data overnight is aiding the US dollar.

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. MACD is hinting at a bearish price trend.



Key Levels

Support1.23501.23051.2375
Resistance1.24101.24601.2505










Technical Overview

USD/JPY – Price reached a high of 134.70 this 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 in the overbought zone and is hinting at a price decline ahead. However 20EMA and MACD are both hinting at a bullish price trend. We see price moving lower to 133.25 in the next 48 hours.

Support134.05133.35132.85
Resistance134.70135.10135.80

EUR/USD – Price reached a low of 1.0908 overnight and we have seen a rally to 1.0950 this morning. However, the rally is likely to be capped by the 20EMA at 1.0970 and we could see another decline to 1.0865 in the next 48 hours. Stochastic is in the oversold zone and is hinting at a limited downside. Both stochastic and 20EMA are hinting at a bearish price trend. We are in favour of the bearish price move.

Support1.09051.08751.0830
Resistance1.09651.10001.1060

XAG/USD – Price had reached a high of $26.07 last week and we have seen a corrective decline lower to $24.79 on Monday. We are likely to see a rally to the Fibonacci 62% correction point at $25.58 in the next 24 hours. We think this is the second part of a 3-part correction. There should be another decline in the next few days to $24.45. Stochastic is hinting at a price rally while both MACD and 20EMA are hinting at a price decline.

Support24.9524.5524.15
Resistance25.3025.6025.95

XAU/USD – Price reached a high last week at $2048.45 last night following a divergence with MACD. Price reached a low at $1980.95 overnight. A Hammer candlestick price pattern is also hinting at a possible temporary low. We are likely to see a rally to $2015 in the next 24 hours but this rally is likely the second part of a 3 part corrective decline process following the high at $2048.45.

Support1991.851980.951966.00
Resistance2002.952014.952031.70

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. Stochastic is reaching the overbought level and is hinting at a limited upside. MACD remains bearish and is hinting at a bearish price trend. 20EMA is also hinting at a bearish price trend. We see price moving lower to 1.3299 in the next few days.

Support1.33401.32901.3260
Resistance1.33851.34201.3470

FX Commentary – U.S. Dollar Tumbled On Imminent End To Rate-Hike Cycle

Nicholas

Market Talk
– The U.S. dollar tumbled to a one-year low against a basket of currencies on Friday while the euro hit a one-year peak, as traders ramped up expectations of an imminent end to the U.S. Federal Reserve’s rate-hike cycle on signs of cooling inflation.

– Data from the U.S. Labour Department on Thursday showed the producer price index (PPI) fell by the most in nearly three years last month, coming a day after inflation data pointed to moderation in consumer prices, reinforcing the view of end to interest rate hikes.

– The euro rose to a fresh one-year top of $1.1075, pushing past its previous high from Thursday. The British pound was similarly perched near a 10-month high and last at 1.2526. The Japanese yen rose marginally to 132.44 per dollar

– An unexpected surge in Chinese exports, kept the Australian dollar supported at around $0.6788 on Friday, after having surged 1.3% in the previous session. The New Zealand dollar similarly gained 0.13% to $0.6305 in Asia trade, after jumping 1.3% on Thursday.

– Gold was up at $2,044 an ounce after striking a one-year peak of $2,048.71 overnight, not far from its all-time top of $2,072. Signs of cooling inflation and worries about a possible recession are aiding the yellow metal.


Chart Focus XAU/USD – Gold

Key Points

1. Trading Sell Gold recommendation

2. Sell Gold at $2045. Stop at $2048.45 and profit target at $2020.50

3. Expectations of an imminent end to the U.S. Federal Reserve’s rate-hike cycle on signs of cooling inflation is aiding Gold

4. A price pattern and a divergence in MACD are both hinting at a possible price high.

Fundamental Comments

1. Expectations of an imminent end to the U.S. Federal Reserve’s rate-hike cycle is aiding Gold

2. A sharp drop in US PPI is reinforcing the view of end to interest rate hikes.

Technical Comments

1. A Hanging Man candlestick price pattern is hinting at a possible high in price.

2. A divergence warning from the MACD indicator is hinting at a possible price high.










Technical Overview

USD/JPY – Price had reached a high on Tuesday but has tumbled down to 132.01 overnight. Stochastic is near to the low and is hinting at a possible price rally. MACD and 20EMA remain bearish and are both hinting at a bearish price trend ahead. MACD had earlier warning of a possible price high with divergence, hinting at a possible price high. We think price is likely to move lower to 131.00 in the next few days.

Support132.00131.50131.00
Resistance132.65133.15133.75

EUR/USD – Price reached a fresh 12-month high at 1.1075 overnight but there was no divergence warning. This is a hint that price can continue to move higher. Both MACD and 20EMA are also hinting at a continuation of this rally. Stochastic is deep in the overbought zone. We think price can continue to move higher to 1.1185 in the next few days. A price move below 1.0975 would negate our bullish view.

Support1.10401.09951.0935
Resistance1.10751.11051.1155

GBP/USD – Price reached a fresh 10-month high at 1.2546 this morning and looks like it can continue to move higher. However, a possible divergence could be forming on the MACD indicator, warning of a possible price high in the marking. Stochastic is in the overbought zone and is hinting at a limited upside. 20EMA remains bullish. We think the upside could be limited and a correction to 1.2485 is likely before the uptrend resumes again.

Support1.24801.24101.2345
Resistance1.25551.25951.2660

XAG/USD – Price reached a high of $25.65 overnight but this high was accompanied by a bearish divergence warning from the MACD indicator, warning of a possible price high in the making. Stochastic is also hinting at a price decline but 20EMA is hinting at a strong bullish price trend. As long as price can stays above $25.10, we are likely to see a rally to $26.15 but a move below $25.10, it is a hint of a price high and a decline to $24.20.

Support25.0524.7024.20
Resistance25.6525.9026.20

NZD/USD – Price reached a high of 0.6314 this morning and the rally looks like it will continue higher to 0.6375 in the next few days. Stochastic is in the overbought zone and is hinting at a limited upside. However, both MACD and 20EMA are both hinting at a strong bullish price trend. We think there could be a small price correction to 0.6260 in the next 24 hours before the rally resumes for 0.6314 in a few days’ time.

Support0.62800.61350.6085
Resistance0.63150.63500.6375

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 – Greenback Boosted By Position Squaring Ahead of NFP

Nicholas

Market Talk
– The U.S. dollar advanced on Wednesday, recovering from two-month lows hit in the previous session, as investors lightened their short positions to book profits ahead of the all-important U.S. non-farm payrolls report on Friday.

– Overnight, the ADP National Employment report showed U.S. private employers hired fewer workers than expected in March, suggesting a cooling labour market. The jobs data supported the view that the Federal Reserve may not need to raise rates much further.

– The greenback posted its third daily loss against the yen to 131.15 as Treasury yields extended their decline. The euro edged up to 1.0970 while sterling was last trading at 1.2455, down 0.35% on the day.

– The New Zealand dollar rose 0.1% versus the greenback to $0.6316, rallying by as much as 1.1% to a two-month high of $0.6379 after the Reserve Bank of New Zealand unexpectedly raised interest rates by 50 bps to a more than 14-year high of 5.25%.

– Gold touched its highest in one year as recent U.S. economic data fanned fears of a slowdown and spurred bets the Federal Reserve may ease up on rate hikes. Gold was last trading at $2013.50.

Chart Focus USD/CHF

Key Points

1. Sell USD/CHF recommendation.

2. Sell USD/CHF at 0.9090. Stop at 0.9125 and profit target at 0.9005

3. Weak US job data and views that the Fed is near the end of its monetary tightening cycle is likely to weigh on the US dollar.

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

Fundamental Comments

1. Weak US job data is likely to weigh on the U.S. dollar.

2. Views that the Federal Reserve is near the end of its monetary tightening cycle is likely to weigh on the US dollar

Technical Comments

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

2. MACD is bearish and is hinting at a price decline










Technical Overview

USD/JPY – We had a sell recommendation yesterday at 132.10 but price did not reached our entry price. Price only reached a high of 131.77 and declined to 130.59 overnight. The low was below the Fibonacci 62% correction point of the rally from 129.63 to the high at 133.75.  Stochastic and MACD are both hinting at a price rally. However, 20EMA is hinting at a strong bearish price trend. We think there could be a corrective rally to 131.70 in the next 24 hours.

Support130.95130.60130.05
Resistance131.50132.20132.85

EUR/USD – The overnight decline off the high at 1.0972 had moved below the 20EMA line, hinting at a bearish price trend. However, price is currently being supported by a previous support level. If price can hold above this support level, we can see a test back to the previous high at 1.0972. If price fails to hold above this support, we are likely to see a price decline to 1.0785. We prefer the bullish view.

Support1.08851.08451.0785
Resistance1.09301.09751.1030

GBP/USD – Price had reached a high of 1.2524 on Tuesday and declined to the 20EMA support at 1.2435 overnight. MACD is hinting at a price rally in the next 24 hours. 20EMA is also hinting at a price rally. However, stochastic is hinting that the decline may not be over as yet. We prefer to go with the MACD and we think price is likely to be support at 1.2435 and we are likely to see a rally to 1.2525 again in the next 24 hours.

Support1.24351.23801.2330
Resistance1.24851.25251.2580

XAU/USD – Price broke out of a triangle chart pattern on Tuesday and reached a overnight high of $2032.16. We think price is likely to continue higher but in the next 24-48 hours, we are likely to see a corrective decline back to the 20EMA line $2003 or the Triangle support at $19935. Stochastic is hinting at a price decline but both MACD and 20EMA are hinting at a bullish price trend.

Support2003.20.1990.451976.80
Resistance2021.202032.202049.70

NZD/USD – Price had risen to a high of 0.6375 yesterday after an unexpected 50 basis points hike by the RBNZ. The rally failed to sustain and we have seen a price decline below the 20EMA at 0.6295. We are likely to see a continuation of this decline to 0.6205 in the next 48 hours. Stochastic is hinting at a price decline. MACD is also hinting at a possible price decline while 20EMA has already turned down.

Support0.62700.62350.6180
Resistance0.63050.63500.6375