15 Dec: Forecast: FX: US$/Majors + trade ideas

By | December 15, 2017


EURUSD: 1.1792
€/Usd has traded a choppy range of 1.1860/1.1770 on Thursday,  after the ECB left rates on hold, with Draghi’s upbeat Press Conference sending the Euro briefly to its highs before the dollar strengthened after the strong RS/jobs data, closing at familiar territory, just under 1.1800.
1 hour/4 hour indicators: Turning higher Daily Indicators: Turning lower Weekly Indicators:  Neutral
Preferred Strategy:  With little data due today, and with the momentum indicators offering little help in either direction, a rangebound session seems most likely. Use 1.1740/1.1830 as a guide. Further out, the weeklies still suggest we could see a stronger dollar at some stage, but don’t get too excited yet.
Resistance Support
1.1939  1 Dec high 1.1770 100 DMA/Session low
1.1903 (76.4% of 1.1960/1.1717) 1.1760 55 DMA
1.1865 (61.8% of 1.1960/1.1717)/Session high 1.1729 13 Dec low / Rising trend support
1.1845 Minor 1.1716 12 Dec low
1.1825 Minor 1.1707 (61.8% of 1.1553/1.1943)

Economic data highlights will include:                                                                                                                

German Wage Price Index, EU Trade Balance, US New York State Empire Mfg Index, Capacity Utilisation, Industrial Production

USDJPY: 112.17
US$Jpy finished the day lower once again on Thursday, towards the lows of 112.05, trading down in sympathy with the lower stock markets. watch out for the Tankan today.
1 hour/4 hour indicators:  Turning lower Daily Indicators: Neutral Weekly Indicators:  Neutral
Preferred Strategy:  As before, while the daily charts remain neutral the short term momentum indicators look heavy on Friday and further downside momentum could now take the dollar back to the recent low of 111.97, below which could give the strong support at 111.75 a nudge. I am neutral today although a minor test of the downside would not surprise.
Resistance Support
113.50 Weekly cloud top 112.05 Session low
113.25 100 HMA 111.95 (61.8% of 110.83/113.75)/6 Dec low
112.95 200 HMA 111.75 100 DMA/200 DMA
112.87 Session high 111.52 (76.4% of 110.83/113.75)
112.50 Minor 111.39 1 Dec low

Economic data highlights will include:                                                                                


GBPUSD: 1.3439
Sterling rose to 6day high 1.3467 after UK Nov retail sales easily beat expectations (1.4% v exp 0.4%) but then chopped around above 1.3400 for the balance of the session after the BOE left rates unchanged, voting 9-0 to keep rates on hold despite the rising inflation concerns. Look out for the BOE Quarterly Bulletin today, which could create some waves.
1 hour/4 hour indicators: Mixed Daily Indicators: Neutral


Weekly Indicators:  Turning higher?
Preferred Strategy:  While the daily charts look inconclusive the 4 hour indicators are pointing to further gains for Sterling, so buying dips towards 1.3400, with a SL below 1.3365 would seem to be a plan, looking for a run back to 1.3500 and possibly towards 1.3520 – last week’s high. Given the absence of any data today it may just be another choppy session, using 1.34/1.35 as a guide.
Resistance Support
1.3520 8 Dec high 1.3390 Session low
1.3500 Minor 1.3375 100 HMA
1.3475 Minor 1.3345 Minor
1.3465 Session high 1.3310 13 Dec low
1.3450 Minor 1.3303 12 Dec low

USDCHF: 0.9873
US$Chf has traded  a range of 0.9840/0.9904 after the SNB left policy unchanged, as expected, but raised L-T inflation forecast.
1 hour/4 hour indicators: Neutral Daily Indicators: Neutral Weekly Indicators:  Neutral
Preferred Strategy:  The short term momentum indicators and the dailies are all now neutral and another rangebound session using 0.9830/0.9820 as a guide.
Resistance Support
0.9965 (76.4% of 0.1137/0.9816) 0.9839 Session low
0.9950 Minor 0.9835 100 WMA /5 Dec low
0.9935 11 Dec high /12 Dec high 0.9827 (61.8% of 0.9742/0.9977)
0.9904 Session high 0.9800 Minor
0.9880 Minor 0.9790 (76.4% of 0.9742/0.9977)

AUDUSD: 0.7673
 AudUsd is trading on a strong note at the end of the US session and further gains do look possible although the 4 hour charts are now in overbought territory and the hourlies are turning a little lower.
1 hour/4 hour indicators: Mixed Daily Indicators: Up Weekly Indicators:  Turning lower
Preferred Strategy:   The short term indicators are now mixed and a choppy session at close to current levels would not surprise although the dailies look constructive for further gains, but now that US rates are at parity with Australian rates I do not really think that the Aud$ has too much upside from here and I would be looking for levels to sell into strength. Patience may be required.
Resistance Support
0.7740 (38.2% of 0.8124/0.7501) 0.7615 Minor
0.7729 2 Nov high 0.7600 Minor
0.7700 7 Nov high 0.7580 Minor
0.7690 200 DMA 0.7565 200 HMA
0.7679 Session high 0.7540 100 HMA

NZDUSD: 0.6994
The Kiwi has had a choppy session either side of 0.7000 and something similar looks likely for Friday although the NZ November manufacturing PMI is a minor risk.
1 hour/4 hour indicators: Turning lower Daily Indicators: Turning higher Weekly Indicators:  Turning lower
Preferred Strategy:  The momentum indicators are now mixed and a cautious stance is required but given the overall lack of major data today I suspect we could chop around current levels for much of the session. In the bigger picture, the Kiwi has a reverse HS formation that suggests a target of around 0.7100 so buying dips would seem to be the plan although if we get there I suspect it would provide a decent longer term sell opportunity.
Resistance Support
0.7115 100 DMA 0.6980 (23.6% of 0.6822/0.7027)
0.7100 200 DMA 0.6960 Minor
0.7075 (38.2% of 0.7557/0.6783) 0.6950 (38.2% of 0.6822/0.7027)
0.7050 Minor 0.6925 (50% of 0.6822/0.7027)
0.7027/30 13 Dec high/(38.2% of 0.7434/0.6783) 0.6900 (61.8% of 0.6822/0.7027)

Economic data highlights will include:                                                                            

Business PMI – Nov