IForex Daily : January 29, 2014
iFOREX | Jan 29, 2015 05:02AM ET
Global investors bet U.S. rate hikes are less likely to start soon after the Federal Reserve said inflation was running below forecasts. U.S. stocks, after spending most of the session higher, reversed course and fell with energy shares leading the way lower. The Dollar strengthened on the Fed's repeated message to be "patient". Some investors saw Fed officials as more optimistic on the U.S. economy, suggesting they will stick with their plan for raising interest rates by mid-year. The Fed's mention of international developments was probably perceived as dovish. They upped their view on growth to strong from solid. U.S. Oil prices were near six-year lows after the government reported record-high inventories in the United States. Gold prices extended losses after the Fed statement. Europe and U.S. post today and tomorrow great quantity of end of month economic reports.
EUR/USD
The Dollar strengthened yesterday in a broad advance against the Euro, taking in pace the Federal Reserve's repeated message it remains "patient" in deciding when to raise interest rates.
EURUSD closed at $1.12845, down 0.73%, in our platform, yesterday.
A secondary drag on the Euro was tough talk from Greece's new anti-austerity government over its 240 billion Euro bailout plan.
Today, expect the market to move with the EU economic sentiment and the U.S. jobless claims as it pays extra attention to Germany's unemployment rate and CPI, EU M3 money supply and U.S. pending home sales.
Pivot
1.1325
Support
1.122
1.115
1.109
Resistance
1.1325
1.1395
1.145
Scenario 1: Short positions below 1.1325 with targets 1.122 & 1.115 in extension.
Scenario 2: Above 1.1325 look for further upside with 1.1395 & 1.146 as targets.
Comment: The pair remains under pressure as the RSI is capped by a declining trend line.
USD/JPY
The Yen was almost unchanged against the Dollar yesterday as investors awaited the Federal Reserve policy statement later in the day.
USDJPY finished at Y117.595, down 0.15% in our platform, yesterday.
Today, expect the market to move with the U.S. jobless claims and Japan's CPI and industrial production, as it pays extra attention to the U.S. pending home sales and Japan's household spending and unemployment rate.
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Pivot
118.3
Support
117.2
116.8
116.3
Resistance
118.3
118.65
118.85
Scenario 1: Short positions below 118.3 with targets 117.2 & 116.8 in extension.
Scenario 2: Above 118.3 look for further upside with 118.65 & 118.85 as targets.
Comment: The pair stands below its resistance and remains under pressure.
XAU/USD
Gold extended losses yesterday after the Federal Reserve said it will remain "patient" with regard to any interest rate increase decisions.
Spot Gold closed at $1,285.26, down 0.62% or $8.06 in our platform, yesterday.
After its first policy-setting meeting of the year, the FOMC said the U.S. economy is on track despite turmoil in other markets around the World. The statement no longer contains the closely watched "considerable time" phrase in connection to interest rates.
Today, expect the market to move with the U.S. jobless claims as it pays extra attention to the U.S. pending home sales.
Pivot
1,271.8
Support
1,271.8
1,264
1,255
Resistance
1,300
1,308
1,317
Scenario 1: Long positions above 1,271.8 with targets 1,300 & 1,308 in extension.
Scenario 2: Below 1,271.8 look for further downside with 1,264 & 1,255 as targets.
Comment: A support base at 1271.8 has formed and has allowed for a temporary stabilisation.
OIL/USD
WTI Crude Oil tumbled to the lowest in almost six years after a government report showed that U.S. crude inventories advanced to the highest level in data going back more than three decades.
WTI futures closed at $44.49, down 2.20% or $0.99 in our platform, yesterday.
Price declines accelerated after the Federal Reserve maintained its pledge to be "patient" on raising interest rates and supported its assessment of the economy and labor market.
Today, expect the market to pay extra attention to the U.S. jobless claims.
Pivot
45.7
Support
43.7
42.6
41.5
Resistance
45.7
46.6
47.8
Scenario 1: Short positions below 45.7 with targets 43.7 & 42.6 in extension.
Scenario 2: Above 45.7 look for further upside with 46.6 & 47.8 as targets.
Comment: As long as 45.7 is resistance, likely decline to 43.7.
DOW/USD
U.S. stocks ended yesterday's agitated trading session sharply lower after the Federal Reserve's policy-making committee reiterated it plans to remain patient and watch the data as it decides when to raise interest rates.
The Dow Future closed at 17,159, down 1.26% in our platform, yesterday.
A renewed slide in Oil prices yesterday sent energy and materials stocks sharply lower.
Today, expect the market to move with the U.S. jobless claims as it pays extra attention to the U.S. pending home sales.
Pivot
17,290
Support
16,885
16,760
16,685
Resistance
17,290
17,490
17,630
Scenario 1: Short below 17,142 with targets 16,885 & 16,760 in extension.
Scenario 2: Above 17,290 look for further upside with 17,490 & 17,630 as targets.
Comment: The immediate trend remains down and the momentum is strong.
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