Daily Market Outlook: EUR/USD Managing A Rebound
FinFX | Mar 03, 2014 05:41AM ET
EUR/USD
The pair goes parabolic on Friday and closes the week resuming its upward movement flushing out of the market eventual sellers. The exchange rate snapped back to the weekly pivot point at 1.3756 on the opening and is presently managing to rebound almost as remarkably to pare the opening losses and closing exhaustion gaps. The overnight slide coincides with a 38.2% correction which could eventually lead to a deeper one towards the 50% confluent now with the 200-SMA on the hourly charts.
The oscillators mirror the price correction coming out of their overbought extremes but manage to flatten above their center lines. Any attempt to stage a new price high above 1.3825 could muster into a negative divergence in the MACD.
Res: 1.3826; 1.3852; 1.3900; 1.4150
Sup: 1.3773; 13756; 1.3722; 1.3642
EUR/JPY
Getting a lift from EUR/USD flows, the euro finished the week challenging the 141.00 figure. The opening around 139.70 happened with 61.8% correction from Friday's rally leaving the cross with a lack of definition as for trend direction. The MACD, albeit exhibiting an extreme high on Friday, is now printing in negative territory. The RSI in turn, could not sustain a break of the 70% mark in recent sessions and imploded back below the 50% line (currently at 41%). The pair trades now below the weekly pivot point at 140.11 with a series of small body candlesticks, indicative of indecision where to finish the session.
Res: 140.00; 140.11; 140.22; 141.34
Sup: 139.34; 139.10; 138.77; 136.20
GBP/USD
The Sterling managed to fill any possible opening gaps and looks positive against the dollar, currently trading above 1.6700. It is still trapped in the sideways range from the last two weeks, capped by 1.6820 on the upside and 1.6600 when looking south. The series of higher lows from recent sessions point to a potential recapture of the mentioned ceiling. The 200-SMA, while printing well below the current price, looks promising as well with its attempt to head higher. In turn, the upward sloping 100-SMA is where price is currently perched with some precarious intraday doji patterns. The oscillators are senn in positive numbers, specially the RSI which hasn't dipped below 50% in a while. A break of its narrow range could be taken as an early signal where the session is headed.
Res: 1.6780; 1.6800; 16820; 1.6874
Sup: 1.6728; 1.6700; 1.6636; 1.6600
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USD/JPY
Traders are now more confident that serious inroads to the downside can be achieved in the USD/JPY. The dollar lost value against its Japanese counterpart on Friday and wasn't able to recover them on the open. Touching oversold levels on the hourly charts, the oscillators add credence to this bearish view. Lower lows on both MACD and RSI would set the stage for further weakness in this major pair en-route to sub 101.00 levels.
Res: 101.50; 101.87; 102.00; 102.20
Sup: 101.13; 100.71; 100.15; 99.77
AUD/USD
The Aussie is staging a V-shape reaction from a marginally lower low than the one printed on the 27th, in the vecinity of 0.89 building a double bottom structure neck-lined at 0.8989. The potential for the formation to act as a reversal pattern is slim due to the lack of a trend to be reversed. The bigger picture still looks sideways despite the recent volatility on lower time frames. The oscillators, still below their center lines, are shifting from an oversold picture to becoming witness of a notorious rally in the price action. The pair could extend gains up to the supply are found at 0.8970. On the way south , demand at the overnight lows could be exhausted and opening scope for a short-term turn lower towards support barriers at lower levels.
Res: 0.8944; 0.8970; 0.9000; 0.9017
Sup: 0.8900; 0.8870; 0.8825; 0.8750
AUD/NZD
The hourly structure continues to suggest a downside bias, in accordance with the major trend. Last week we say a corrective process which elevated the bulk of trading to the 1.0850 zone, but closing the week, the AUD/NZD plunged to multi-week lows around 1.0650 where it is presently quoting.
Should a a higher low be put in place above the 1.0480, the Pacific cross would become entitled for a deeper upside reaction. But there are still few technical arguments to compound such a bullish scope. The pair is struggling sustain itself above the daily pivot in recent trading with the MACD barely resurfacing the zero line. The RSI is performing similarly in the hope of morphing into a intraday bullish divergence. For this scenario to happen we would need a new intraday low below 1.0620 with higher lows in the oscillators.
Res: 1.0692; 1.0705; 1.0737; 1.0778
Sup: 1.0605; 1.0570; 1.0518; 1.0500
XAU/USD
Spot gold offers supplementary evidence of the unanimously bid on the U.S. dollar with its knocking on the door of the 1350 level. The yellow metal maintains a bullish bias follow two months of bullish offensive. On the short-time charts, the MACD, being an open indicator, is not yet at historical extremes but nevertheless rubbing shoulders with previous overbought levels. The RSI presents itself with an impressive run-up from the 30% level to the 70% where it decided to stay for the last hours.
A bullish SMA cross o the chart reaffirms the primary trend and reassures Gold could stay swinging in the breeze up around current levels.
Res: 1350.00; 1360.00; 1373.00; 1390.00
Sup: 1340.00; 1332.00; 1326.00; 1320.00
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