15 Dec: Fed hikes by 25 bp; projects 3 more in 2017. BOE, SNB meetings today. Australian jobs data coming up.

By | December 15, 2016

So, the FOMC have voted and unanimously elected to raise rates by 25 points, as expected, and although the Statement is not overly hawkish the dot plot of rate hikes was a surprise, suggesting 3 hikes in 2017 instead of the 2 that had previously been thought likely. The dollar spiked immediately higher on the news ahead of Janet Yellen’s Press Conference. The Fed statement added that data since the September meeting indicates that the labor market has continued to strengthen and that growth of economic activity has continued to pick up from the modest pace seen in the first half of this year. Expectations are for inflation to rise to 2% pa over the next two years. The Press Conference added very little to the Statement and at the time of writing the dollar has maintained its earlier gains and is currently chopping around as traders dissect the outcome of the decision. Notably, US$Jpy has spiked to a new trend high, while the DJI has pulled back from just shy of the 20,000 barrier.

While much of the coming session will be spent dissecting the FOMC decision, there is plenty coming up today to provide additional volatility. First up this morning will be NZ Business PMI and then the Australian Unemployment data (exp +20K, 5.6%). This will be followed in the day by the interest rate decisions from both the SNB and then the BOE, although no major change to policy is expected from either. Other data in Europe will come via the flash PMIs and the UK November Retail Sales (exp 0.2%), while from the US we have another busy session, headed by the November CPI figure (exp 0.2%mm, 1.7% yy) but also including the Current Account, New York State Empire Mfg Index, Jobless Claims, Philadelphia Fed Mfg Survey, NAHB Housing Market Index and the Markit flash Manufacturing PMI.

CURRENCIES
EURUSD: 1.0532
Res  1.0550  1.0585  1.0610
Sup  1.0495  1.0460  1.0400
USDJPY: 117.02
Res  117.40  117.65  117.80
Sup  116.80  116.40  116.10
GBPUSD: 1.2552
Res  1.2600  1.2630  1.2655
Sup  1.2530  1.2500  1.2420
USDCHF: 1.0203
Res  1.0225  1.0255  1.0300
Sup  1.0170  1.0145  1.0120
AUDUSD: 0.7407
Res  0.7430  0.7450  0.7470
Sup  0.7395  0.7370  0.7335
NZDUSD: 0.7117
Res  0.7140  0.7160  0.7185
Sup  0.7105  0.7070  0.7040
INDICES / COMMODITIES
S+P: 2258
Res  2264  2278  2290
Sup  2248  2234  2222
DJI: 19831
Res  19880  20000  19965
Sup  19745  19700  19600
ASX SPI: 5488
Res  5510  5538  5554
Sup  5480  5458  5440
GOLD: 1143
Res  1150  1160  1166
Sup  1138  1120  1100
SILVER: 16.81
Res  17.00  17.20  17.55
Sup  16.65  16.50  16.15
OIL (WTI): 50.85
Res  51.60  52.40  52.75
Sup  50.00  49.50  49.00

 

Indices/commodities
S&P Futures 2258

The S+P is back at 2250 after having earlier made it to the all-time high of 2276.

The 4 hour momentum indicators are turning lower and the dailies also appear to be topping out so some caution is now warranted on the topside. After the strong run higher, there is now minor support at 2240 and 2230 (200 HMA) but really not too much to be seen until 2220 (23.6% of 2028/2276), below which could see a quick return to 2200. On the topside, resistance will be seen at 2260/65 and again at the all-time high, above which would see the slow grind continue to 2300, albeit this now seems delayed for a while.

24 Hour: Prefer to sell rallies

Medium term: Mildly bearish

 

                                         Resistance Support
2280 Minor 2247 Session low
2275 Minor 2235 Minor
2277 All-time high/Session high 2230 Minor
2265 Minor 2225 Minor
2260 Minor 2220 Minor
DJI Futures 19831

Ditto S+P. The momentum indicators are beginning to suggest a top may be in place, today at yet another all-time high, at 19964, which may be significant, as the DJI then fell by 150 points, forming a key day reversal in the process. A run back to 19600 and possibly to 19350 could be on the cards, while on the topside, the approach to 20,000 will see plenty of sellers.

24 Hour: Prefer to sell rallies

Medium term: Mildly bearish

 

Resistance Support
23000 Minor 19747 Session low
22000 Minor 19700 Minor.
21000 Minor 19600 Minor
20000 Minor 19500 Minor.
19964 All-time high/Session high 19400 Minor
ASX SPI 5488

The Fed rate hike has seen the ASX fall to a low of 5487 with very little bounce seen so far.  As with the US indices, the 4 hour/daily momentum indicators both now suggest that it may be the downside that comes under pressure, where minor support will arrive at 5475 , below which could see a run towards the 7 Dec low of 5447 and then to the 6 Dec low of 5422. On the topside, resistance will be seen at 5550 and at the 5585/90 area although that looks delayed for a while to come

24 Hour: Prefer to sell rallies

Medium term: Mildly bearish

 

Resistance Support
5580 Minor 5485 Session low
5555 100 HMA 5457 (23.6% of 5029/5681)
5549 Session high 5440 Minor
5535 Minor 5410 100 DMA
5510 200 HMA 5388 5 Dec low
GOLD 1143

Gold has now fallen to 1139, with not too much now to hold it up ahead of 1120.  Beneath there would allow a move to 1100, a break of which could then see a run towards 1090 and even to 1050.

The topside will see offers at 1150 and again at 1160/65. Selling rallies is preferred.

24 Hour: Neutral

Medium term: Prefer to sell rallies

 

Resistance Support
1180 7 Dec high 1139 Session low
1172 200 HMA 1130 Minor
1165 Session high /12 Dec high 1122 (76.4% of 1046/1375)
1157 Minor 1108 28 Jan low
1150 Minor 1100 Minor
SILVER 16.81

Silver is back at 16.80 and looks heavy, with further downside on the cards according to the short term momentum indicators. If so, then below the 12 Dec low of 16.67 could see another run back to last Monday’s low of 16.48, a break of which could see another test of the 2 Dec low of 16.31. Under that would eventually open the way to the minor double bottom at 16.16 and possibly 16.00. On the topside, 17.00 will again provide resistance. Further out, above the session high (17.21), resistance will be seen at 17.25, above which would then open the way to 1.7.50/55 and possibly back to the 200 DMA at 17.75. Selling rallies is preferred.

24 Hour: Prefer to sell rallies

Medium term: Neutral

 

Resistance Support
17.57 (50% of 18.98/16. 17) 16.74 Session low
17.40 14 Nov high 16.67 12 Dec low
17.23 (38.2% of 18.98/16. 17)/7 Dec high 16.48 5 Dec low
17.21 Session high 16.31 2 Dec Low
17.00 Minor 16.16 25 Nov Low/23 Nov low
OIL (WTI) 50.85

WTI is back at the neckline of the s/h/s formation and beginning to look heavy given that the daily momentum indicators appear to be rolling over, so stop losses on longs should be kept pretty tight below the current 50.75 lows.

Further support will arrive at 50.00/49.75, but below which could see an acceleration towards 48.00/50. On the topside, resistance will be seen at 52.50/70 and then again at the session high of 52.75. Selling rallies now seems to be the plan

24 Hour: Prefer to sell rallies

Medium term: Prefer to sell rallies

 

Resistance Support
54.48 12 Dec high 50.75 Session low
53.30 Minor 50.00 Psychological
52.75 Session high 49.58 8 Dec low
52.40 Minor 49.00 Minor
51.60 Minor 48.30 (50% pivot of 42.18/54.48)

EURUSD: 1.0532

Late in the US session the Euro has been down to 1.0495, currently back at 1.0530.

The dollar spiked higher on the release of the Fed statement, with the Euro falling from 1.0640 to a low of 1.0557 but currently trading at XXX. Note that a key day reversal has formed on the daily chart.

Technically, on the downside, back below the session low would allow a retest of the 12 Dec low of 1.0525 and last Monday’s low of 1.0504.  Below 1.0500 would eventually open the way to the March 2013 low at 1.0461. Under here there is very little to hold the Euro up until we reach almost to parity (1.0070=61.8% of 0.8225(Oct 2000 low)/1.6037(July 2008 high)) and at some stage we seem destined to get there, and I suspect a fair bit lower in 2017. On the topside, minor resistance will be seen at the session high at 1.0665, above which could see a run back to 1.0700 and possibly to 1.0740.

With the momentum indicators for the Euro now looking mixed to fairly flat, further choppy trade seems likely today as traders continue to re-position but in the longer term, as before, looking to sell into Euro strength seems to be the plan heading into 2017 as I suspect the dollar’s strength will resume, with the Euro coming under increasing pressure of its own.

24 Hour: Neutral – Prefer to sell rallies Medium term: Mildly bearish

 

Resistance Support
1.0666 Session high/200 HMA 1.0495 Session low
1.0630 Minor 1.0461 March 2015 low
1.0610 100 HMA 1.0400 Minor
1.0585 (23.6 of 1.0495/1.0872) 1.0350 Minor
1.0560 Minor 1.0334 Jan 2003 low

Economic data highlights will include:

EU Flash Mfg/Services/Composite PMIs, US Current Account, New York State Empire Mfg Index, CPI, Philadelphia Fed Mfg Survey, NAHB Housing Market Index Markit Flash Manufacturing PMI, Jobless Claims

Meta Trader
EURUSD: 4 Hour

euro


USDJPY: 117.02
Late in the US session, UsdJpy has spiked to 117.39, currently back at 117.00.

US$Jpy spiked to 116.45 following the FOMC decision and is currently sitting below there.

The technical picture suggests that while the dailies remain overbought, the short term momentum indicators are supportive of further gains, which could see a test of 117.00 and then of  117.80 (76.4% of 121.05/98.94), with the next major resistance then being seen at the descending trend resistance at around 118.80.

On the downside, support will be seen at 116.00 and then at 115.50/115.00.

For the time being, buying dips seems to be the plan, with a SL placed under 115.00.

24 Hour: Mildly bullish Medium term: Neutral

 

Resistance Support
118.80 Descending trend resistance 116.80 Minor
118.00 Minor 116.40 Minor
117.80 (76.4% of 121.05/98.94)) 116.10 Minor
117.60 Minor 115.50 Minor
117.39 Session high 115.00 Rising trend support

Economic data highlights will include:

Foreign Bond/Stocks Investment

Meta Trader
USDJPY: 4 Hour

yen


GBPUSD: 1.2552

Late in the US session Cable has been down to 1.2530, breaking the rising trend support, but is currently back at 1.2565.

Cable is under pressure at the end of the US session, now down at 1.2600 and looks likely to give the rising trend support at 1.2560 a decent workout. The short term momentum indicators are pointing mildly in this direction at time of writing.

Under there could bring about further weakness, taking Cable back to 1.2400/10 so keep stops on long positions tight below 1.2500.  On the topside, back above minor resistance at 1.2660 and again at 1.2700  and the session high (1.2723) could potentially open the way back to 1.2740 ahead of the 1.2774 trend high, beyond which, further sellers will arrive at the 100 DMA at 1.2785.

24 Hour: Mildly bearish Medium term: Mildly bearish

 

Resistance Support
1.2727 Session high 1.2530 Session low
1.2700 Minor 1.2500 Minor
1.2655 200 HMA 1.2410 (38.2% of 1.1821/1.2775)
1.2640 100 HMA 1.2370 Minor
1.2600 Minor 1.2350 Minor

Economic data highlights will include:

Retail Sales, BOE Interest Rate Decision

Meta Trader
GBPUSD: 4 Hour

gbp


USDCHF: 1.0203

Late in the US session, UsdChf has spiked to 1.0222, currently back at 1.0200.

US$Chf is back at 1.0190 after jumping up from 1.0090 and looks like giving 1.0200 and the recent high of 1.0213 a decent nudge, above which we could make our way towards 1.0255 and then to 1.0327 (Nov ‘15 high).

The downside looks supported at 1.0150 and 1.0100, with a SL best placed below the 1.0088 low.

24 Hour: Neutral Medium term: Neutral

                                                                

Resistance Support
1.0350 Minor 1.0170 Minor
1.0327 27 Nov 2015 high 1.0145 100 HMA
1.0300 Minor 1.00120 200 HMA
1.0255 22 Nov high 1.0100 Minor
1.0225 Session high 1.0088 Session low

Economic data highlights will include:

SNB Interest Rate Decision, Press Conference

Meta Trader
USDCHF: 4 Hour

chf


AUDUSD: 0.7407

Late in the US session the Aud has been down to 0.7393, breaking the rising trend support, but is currently back at 0.7410

The Aud is down 100 bp from the 0.7522 high, currently at 0.7420 and looking heavy going into the Asian session. Note that a key day reversal has formed on the daily chart.

If so, the initial support lies close by at 0.7400/10, a break of which could then head back to the recent support at 0.7360/70. Under there could then see a move towards 0.7335 and then to 0.7300/10.

On the topside, resistance will be seen at 0.7470 and again at 0.7500/20, where the @2d has provided stern resistance. I don’t think we see it again today and prefer to sell into strength. The same applies to the longer term; I still prefer to trade from the short side, given the potential for diverging monetary policy between the RBA/Fed heading into 2017.

Unemployment today (exp 5.6%, +20K)

24 Hour: Mildly bearish Medium term: Mildly bearish

 

Resistance Support
0.7500 Psychological 0.7393 Session low
0.7475 100 HMA 0.7363/61 24 Nov low/22 Nov low
0.7465 200 HMA 0.7335 Minor
0.7450 Minor 0.7310 21 Nov low
0.7430 Minor 0.7290 (76.4% of 0.7144/0.7777)

Economic data highlights will include:

Consumer Inflation Expectation, Unemployment

Meta Trader
AUDUSD: 4 Hour

aud


NZDUSD: 0.7117

Late in the US session the Kiwi has been down to 0.7104, currently back at 0.7120

As with the Aud, the Kiwi has fallen following the Fed decision, from a high of 0.7238 to a current level of around 0.7130, forming a key day reversal has formed on the daily chart.

For the coming session, bids will be seen at the 12 Dec low of 0.7115 below which 0.7090/0.7100 would provide further support. Under there could then see a run back to 0.7060 (200 DMA) and then to 0.7035, beneath which there is little to support it until 0.6970/80.

On the topside, minor resistance will again be seen at 0.7155 (200 HMA) and at 0.7180 (100 HMA), ahead of 0.7200, which should be strong today, if seen, but above which could see a return to the 0.7238 high.

24 Hour: Mildly bearish Medium term: Mildly bearish

 

Resistance Support
0.7238 Session high 0.7104 Session low
0.7200 Minor 0.7090 Minor
0.7185 100 HMA 0.7068 5 Dec low
0.7160 200 HMA 0.7050 Minor
0.7140 Minor 0.7035 28 Nov low

Economic data highlights will include:

Business PMI

Meta Trader
NZDUSD: 4 Hour

nzd

The post 15 Dec: Fed hikes by 25 bp; projects 3 more in 2017. BOE, SNB meetings today. Australian jobs data coming up. appeared first on FX Charts Daily.