USD/CAD retreats farther from Friday’s 3-week tops amid bullish oil prices
Our preference: short positions below 1.3455 with targets at 1.3415 & 1.3395 in extension.Alternative scenario: above 1.3455 look for further upside with 1.3470 & 1.3490 as targets.
• Bullish oil prices underpin Loonie and prompt some fresh selling on Monday.
• The USD holds stable near multi-week tops and helped limit further downside.
The USD/CAD pair came under some fresh selling pressure at the start of a new trading
week and extended the previous session’s late pullback from three-week tops.
Having jumped to levels beyond the key 1.3500 psychological mark on Friday,
the pair started losing steam in reaction to the news that the US was set to remove the steel and aluminium tariffs on Canada.
The retracement slide extended through the early part of Monday’s trading action and was further pressurized
by a goodish pickup in Oil prices, which benefitted the commodity-linked currency – Loonie.
In fact, Oil is now up by around 1.30% on the day, supported by escalating tensions in the Middle East and indications that
OPEC+ would probably decide to maintain production cuts next month.
On the other hand, the US Dollar held stable near multi-week tops and might turn out to be the only factor that helped
limit any deeper losses amid persistent market concerns about US-China trade tensions.
With the Canadian markets closed in observance of Victoria Day, empty US economic docket seems
unlikely to provide any meaningful impetus on Monday and leaves the pair at the mercy of USD/Oil price dynamics.
USD/CAD climbs higher toward 1.3500 amid broad-based USD strength
Our preference: long positions above 1.3455 with targets at 1.3505 & 1.3520 in extension.
Alternative scenario: below 1.3455 look for further downside with 1.3440 & 1.3415 as targets.
US Dollar Index inches closer to 98.
West Texas Intermediate stays quiet above $63.
Coming up: The UoM’s Consumer Confidence Index from the U.S.
After spending the large part of the day in a relatively tight range near mid-1.34s,
the USD/CAD pair gained traction in the last couple of hours supported by the strong USD demand. As of writing,
the pair was trading at 1.3492, adding 0.25% on a daily basis.
The broad-based selling pressure surrounding major European currencies following the news of cross-party talks in the
UK failing on Friday seems to be helping the greenback outperform its rivals. The US Dollar Index,
which started a recovery move after testing the 97 handle on Monday, advanced to its highest level since May 3 at 97.95
and was last seen near that level, adding 0.12% on a daily basis.
USD/CAD slides to fresh weekly lows, closer to 1.3400 handle amid rising oil pricesOur preference: short positions below 1.3440 with targets at 1.3390 & 1.3360 in extension.Alternative scenario: above 1.3440 look for further upside with 1.3450 & 1.3465 as targets.
• Rallying oil prices underpin Loonie and exert some downward pressure.
• A modest USD pullback further contributes to the ongoing downfall.
• Traders now eye second-tier economic data for some fresh impetus.
The USD/CAD pair remained under some selling pressure for the third consecutive session on
Thursday and dropped to fresh weekly low, around the 1.3415-10 region in the last hour.
After once again failing to make it through the key 1.3500 psychological mark, the pair
witnessed some long-unwinding pressure on Wednesday amid a solid bounce in Oil prices, amid intensifying tensions in the Middle East.
:EUR/GBP technical analysis: 100-day SMA grabs the buyer’s immediate attention
Our preference: under pressure below 0.8708.
Alternative scenario: above 0.8708, look for 0.8741 and 0.8761.
Gradual improvement in RSI joins a sustained break of short-term resistance to favor the further upside.
100-day SMA grabs the spotlight for now.
Sustained trading beyond 0.8650/55 horizontal area enables the EUR/GBP pair to trade near
0.8680 while heading into the European session on Wednesday.
Should the bulls remain in command, 100-day simple moving average (SMA) level around
0.8700 can become their immediate favorite prior to the 38.2% Fibonacci retracement of January – March downturn, near 0.8715.
Given the price strength remain intact beyond 0.8715, 0.8740 and 0.8760 can entertain optimism ahead of challenging them with
0.8790 – 0.8800 resistance-zone comprising 200-day SMA and 50% Fibonacci retracement.
NZD/USD – Asian demand to extend temporarily -3cA
Our preference: as long as 0.6564 is support look for 0.6620.
Alternative scenario: below 0.6564, expect 0.6543 and 0.6531
This week’s signals have continued to point lower and these are so far being
confirmed with Monday posting a loss of almost ½ Big Fig. A 4 Big Fig sell-off since March’s
.6939 top has taken prices below their key daily average rates which is negative,
but it has also left intraday sentiment oversold and testing November’s .6513 base.
Buyers have returned to the market in Asia this morning, but although those gains are probably
corrective and temporary the outlook for Tuesday is very cautiously bullish and the call is to buy on the open and then at .6568,
yesterday’s low with a stop loss at .6525, last week’s base.
Targets are to .6599, this week’s opening trade, .6615, Friday’s top and .6647, last week’s high trade.
EUR/AUD Aims Lower, while AUD/USD Can Face A Bigger Bullish Turn!
Our preference: short positions below 0.7005 with targets at 0.6980 & 0.6965 in extension.
Alternative scenario: above 0.7005 look for further upside with 0.7020 & 0.7040 as targets.
In risk-on mode EURAUD may see a drop which turned down from interesting resistance, but still have to see lower trendline of an ending diagonal broken to confirm a top in place.
This pair may come in play when AUDUSD completes wave five which is not the case yet…
NZD/USD Analysis: Decline after rate cuts
Our preference: the downside prevails as long as 0.6599 is resistance.
Alternative scenario: the upside breakout of 0.6599, would call for 0.6620 and 0.6632
During the past 24 hours, the New Zealand Dollar has depreciated about 103 base points against the US Dollar.
The decline was attributed to the New Zealand Central Bank.The Central Bank of New Zealand cut its interest rate for the first time in two-and-a-half years on Wednesday, sending the New Zeeland Dollar to a six-month low against its US counterpart. However, the Kiwi recovered some of its lost points at the end of the European trading session.By and large, it is likely that the pair will aim for a resistance level set by the 200-hour SMA at 0.6635 today.
Our preference: short positions below 111.20 with targets at 110.95 & 110.80 in extension.Alternative scenario: above 111.20 look for further upside with 111.35 & 111.50 as targets.
A bounce in Treasury yields and equities helped USD/JPY recover the 111.00 mark.
First-tier data released Wednesday failed to clear uncertainty.
The USD/JPY pair recovered above 111.00 and trades near a daily high of 111.16,
finding support in the better performance of equities during the Asian session ad a bounce in US Treasury yields ahead of the opening.
Following the flood of first-tier news release Wednesday, most major pairs are little changed, as the uncertainty hasn’t been cleared as expected.
Both, the ECB and the Fed offered dovish statements, Brexit has been once again delayed, this time to the end of October,
while US inflation remains subdued and EU growth depressed, backing the central banks’ decisions. Japan released overnight March Money Supply,
which increased by 2.4% YoY. The US macroeconomic calendar will include today the March Producer Price Index,
with the core readings seen up by 0.2% MoM and by 2.4% YoY, and weekly unemployment claims for the week ended April 5.
The 4 hours chart for the pair shows that the price is finding resistance around a flat 200 SMA, while the 20 SMA maintains its bearish slope, nearing the larger one from above,
making of the 111.20 area the immediate resistance. Technical indicators in the mentioned chart have recovered further within negative levels,
with modest upward slopes that fall short of indicating buying interest. The bearish case would likely resume on a break below 110.75, the 50% retracement of the latest bullish run,
while bulls will take over if the pair manages to advance beyond 111.55.
GBP/USD Technical Analysis: Turning bearish again, break below ascending trend-channel awaited
Our preference: long positions above 1.3060 with targets at 1.3120 & 1.3150 in extension.Alternative scenario: below 1.3060 look for further downside with 1.3025 & 1.2990 as targets.
• The pair had good two-way price moves since the beginning of this week and has been
oscillating in an ascending trend-channel formation on hourly charts.
• However, the fact that the pair remains well below important intraday moving averages –
50, 100 & 200-hour SMAs, points to increasing near-term selling bias.
• Meanwhile, technical indicators on hourly/daily charts have just started gaining negative
traction and add credence to the bearish outlook amid the recent Brexit chaos.
• A convincing break below the trend-channel support will confirm a near-term bearish
breakdown and accelerate the slide towards the key 1.30 psychological mark.
USD/JPY Completing Bullish ABC Zigzag Pattern at 112?
Our preference: long positions above 111.15 with targets at 111.55 & 111.75 in extension.Alternative scenario: below 111.15 look for further downside with 110.85 & 110.60 as targets.
The USD/JPY is approaching a key resistance trend line (red) and 78.6% Fibonacci retracement level of wave X vs W (pink).
A bearish bounce would confirm the potential end of the ABC (purple) zigzag pattern.