IForex Daily : January 23, 2014
iFOREX | Jan 23, 2015 04:07AM ET
Wall Street jumped 1.5% and European shares climbed to a seven-year high, with German stocks hitting record highs on Thursday and Asian stocks extending the Global rally on Friday as World Markets cheered the European Central Bank's new stimulus program, worth more than 1 trillion Euros, while the Euro slipped to an 11-year low. Crude Oil bounced on Thursday after Saudi Arabia announced that their King had died and his successor moved quickly to name his own heir to rule the world's biggest Oil exporter offsetting data showing that U.S. stockpiles surged the most in 14 years, Chinese growth is stagnant, and pressure from a strong Dollar. Gold prices bounced around cautiously as hopes that the ECB's action would boost growth contended with the threat of a stronger Dollar, which would put pressure on products priced in the U.S. currency. The market is gearing up for another trial as Global Markets await sudden Greek elections on Sunday, January 25.
EUR/USD
The Euro sank to a more than 11-year low against the Dollar yesterday after the European Central Bank launched a landmark bond-buying program that will pump up to one trillion Euros into a declining Euro zone economy.
EURUSD closed at $1.13477, down 2.29%, in our platform, yesterday.
Investors sold the Euro while traders who had made money betting against or 'shorting' it in anticipation the ECB would act to fight deflation and revive the region's economy added to those bets, sending the Euro broadly lower.
Today, expect the market to move with the PMI composite flash of France, Germany and the Euro Zone and U.S. existing home sales and to pay extra attention to the U.S. PMI manufacturing index flash as it focus on the Greek election on Sunday.
Pivot
1.146
Support
1.127
1.115
1.11
Resistance
1.146
1.153
1.1575
Scenario 1: Short positions below 1.146 with targets 1.127 & 1.115 in extension.
Scenario 2: Above 1.146 look for further upside with 1.153 & 1.1575 as targets.
Comment: The pair has broken below its support and remains on the downside.
EUR/JPY
The Euro fell to a three-month low against the Yen yesterday after the ECB said it would buy government bonds from this March until the end of September 2016 pumping 60 billion Euros a month into the economy. The ECB's move highlights a new convergence between looser policies in Europe and Japan.
Get The News You Want
EURJPY finished at Y134.714, down 1.57% in our platform, yesterday.
Today, expect the market to move with the PMI composite flash of France, Germany and the Euro Zone as it focus on the Greek election on Sunday.
Pivot
135.75
Support
133
132
131.05
Resistance
135.75
136.95
137.65
Scenario 1: Short positions below 135.75 with targets 133 & 132 in extension.
Scenario 2: Above 135.75 look for further upside with 136.95 & 137.65 as targets.
Comment: The pair has broken below its support and remains on the downside.
XAU/USD
Gold turned higher and touched a five-month high above $1,300 per ounce yesterday, after the European Central Bank launched a trillion Euro bond-buying program aimed at reviving a declining Euro zone economy.
Spot Gold closed at $1,300.78, up 0.67% or $8.62 in our platform, yesterday.
Mario Draghi said inflation was expected to increase gradually later in 2015 and in 2016. Gold is usually seen as a hedge against inflationary concerns. The recent steep climb in Gold prices has worried some investors, who started to take profits in the previous session and were looking at Sunday's sudden election in Greece and next week's FOMC two-day policy meeting for clues about the wider macro economic environment.
Today, expect the market to move with the U.S. existing home sales and to pay extra attention to the U.S. PMI manufacturing index flash as it focus on the Greek election on Sunday.
Pivot
1,279
Support
1,279
1,271.8
1,264
Resistance
1,317
1,325
1,340
Scenario 1: Long positions above 1,279 with targets 1,317 & 1,325 in extension.
Scenario 2: Below 1,279 look for further downside with 1,271.8 & 1,264 as targets.
Comment: A support base at 1279 has formed and has allowed for a temporary stabilisation.
OIL/USD
WTI Crude Oil bounced after the death of the King of Saudi Arabia, the biggest producer in the OPEC, who led the group's decision to maintain its Oil-production quota at a meeting in November, exacerbating a global oversupply that has driven prices lower. The passing of the King increases uncertainty and increases volatility in Oil prices in the near term, as traders speculate on a change in Oil policy.
WTI futures closed at $47.31, almost unchanged in our platform, yesterday.
Oil had a very active session falling after a government report showed that U.S. crude supplies surged the most in almost 14 years, with a 10.1 million-barrel plus increase. A strong Dollar and a stagnant growth in China also pressured the Fuel.
Today, expect the market to pay extra attention to the PMI composite flash of France, Germany and the Euro Zone and U.S. existing home sales and PMI manufacturing index.
Pivot
49.1
Support
45.6
44.75
43
Resistance
49.1
50.8
51.3
Scenario 1: Short positions below 49.1 with targets 45.6 & 44.75 in extension.
Scenario 2: Above 49.1 look for further upside with 50.8 & 51.3 as targets.
Comment: As long as 49.1 is resistance, likely decline to 45.6.
DOW/USD
A late-afternoon rally pushed U.S. stocks to record their best gains in two weeks, as investors came with a strong effect with the European Central Bank's long-awaited plan to initiate a bond-buying program intended to revive the declining Eurozone economy.
The Dow Future closed at 17,734.5, up 1.36% in our platform, yesterday.
In economic news, the number of people who sought new U.S. unemployment benefits in mid-January fell by 10,000, but the level of applicants remained above 300,000 for the third straight week for the first time since July in what's likely a reflection of post-holiday layoffs.
Today, expect the market to move with the U.S. existing home sales and to pay extra attention to the U.S. PMI manufacturing index flash as it focus on the Greek election on Sunday.
Pivot
17,865
Support
17,865
17,700
17,560
Resistance
18,070
18,220
18,320
Scenario 1: Long positions above 17,865 with targets 18,070 & 18,220 in extension.
Scenario 2: Below 17,865 look for further downside with 17,700 & 17,560 as targets.
Comment: The RSI lacks downward momentum.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.