19 Dec: US$ mixed. Aud, Kiwi lower. Liquidity becoming thin, but a heavy US data schedule this week.

By | December 19, 2016

Markets were relatively mixed on Friday following the gyrations seen on Thursday after the FOMC announcement, with the notable exceptions of the Aud and the Kiwi both of which collapsed by around 1% against the dollar and also made considerable losses on the crosses. There was no particular reason for the move although commodities in general, including the base metals, had a tough week which weighed on the commodity bloc currencies. US$Jpy was also lower, hit by the escalation of tensions in the South China Sea, while the European majors all managed a minor recovery. Stocks were steady while oil was a little higher.

This week will see a wind down heading into Christmas although Thursday will be active, with a heavy schedule from the US, including the Q3 GDP, Durable Goods Orders, Personal Consumption/Expenditure and Chicago Fed National Activity Index. Monday will kick off with the German IFO Business Climate/Expectations and that aside it will be mostly secondary data as we head towards the break. One thing to look out for that may cause some ripples is the Australian MYEFO due on Tuesday. There has been a lot of talk recently about the chances of a cut in the Australian Credit Rating, and this week’s Budget Update may be the catalyst for something to happen, so worth keeping an eye

CURRENCIES
EURUSD: 1.0449
Res  1.0475  1.0520  1.0560
Sup  1.0400  1.0365  1.0335
USDJPY: 117.98
Res  118.65  119.00  119.35
Sup  117.45  117.15  116.50
GBPUSD: 1.2484
Res  1.2510  1.2540  1.2565
Sup  1.2455  1.2405  1.2375
USDCHF: 1.0265
Res  1.0310  1.0345  1.0400
Sup  1.0240  1.0225  1.0195
AUDUSD: 0.7298
Res  0.7325  0.7370  0.7395
Sup  0.7265  0.7250  0.7220
NZDUSD: 0.6958
Res  0.6970  0.7005  0.7045
Sup  0.6930  0.6890  0.6840
INDICES / COMMODITIES
S+P: 2255
Res  2268  2278  2290
Sup  2246  2234  2222
DJI: 19794
Res  19860  20000  19965
Sup  19745  19700  19600
ASX SPI: 5489
Res  5502  5520  5548
Sup  5462  5440  5410
GOLD: 1135
Res  1142  1150  1164
Sup  1122  1110  1100
SILVER: 16.11
Res  16.25  16.45  16.60
Sup  15.85  15.50  15.35
OIL (WTI): 51.99
Res  52.40  53.35  54.55
Sup  51.00  49.90  49.05

 

Indices/commodities
S&P Futures 2255

The S+P ranged between 2250/63 on Friday leaving the outlook unchanged

The 4 hour charts are pointing lower and the daily charts also appear to be topping out so some caution is warranted on the topside. After the recent strong run higher, there is now the chance of a minor head/shoulder topping formation, with a neckline at around 2244, an objective at around 2218, and not a lot in between to provide any support. On the topside, resistance will be seen at 2265/70 and again at the all-time high of 2777, 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 15 Dec low/ H/S Neckline
2275 Minor 2235 Minor
2277 All-time high/14 Dec high 2230 Minor
2267 15 Dec high 2225 Minor
2263 Friday high 2220 (23.6% of 2028/2276)
DJI Futures 19794

Ditto S+P. The DJI has ranged between 19762/19861 on Friday, currently at 19800. The dailies may be topping out, in which case, below the 15 Dec low of 19740 could see a run back to 19600 and possibly to 19350. On the topside, the approach to 20,000 will see plenty of sellers, but above which the relentless squeeze higher may continue. I prefer to sell into strength ahead of 20,000, with a tight SL placed just above.

24 Hour: Prefer to sell rallies

Medium term: Mildly bearish

 

Resistance Support
22000 Minor 19740 15 Dec low
21000 Minor 19700 Minor.
20000 Minor 19600 Minor
19964 All-time high/14 Dec high 19500 Minor.
19894 15 Dec high 19400 Minor
ASX SPI 5489

A quick dip to 5462 on Friday in late Australian trade was quickly reversed, for the SPI to finish pretty much unchanged on the day. While the 4 hour charts suggest the chance of a similar session today, possibly using 5500 as a pivot, the daily indicators hint that it may be the downside that eventually comes under pressure, where minor support will arrive at Friday’s low, 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 5515 and at the 5550 area although that looks delayed for a while to come. Staying short and selling into strength with a SL placed above 5560 remains the preferred trade.

24 Hour: Prefer to sell rallies

Medium term: Mildly bearish

 

Resistance Support
5580 Minor 5462 Friday low
5570 Minor 5457 (23.6% of 5029/5681)
5549 14 Dec high 5445 Minor
5515/20 15 Dec high/200 HMA, 100 HMA 5410 100 DMA
5502 Friday high 5388 5 Dec low
GOLD 1135

Gold jumped to a high of 1141 on the news of the US/China dispute in the South China Sea on Friday but drifted lower from there to close the week at 1134. For the time being, 1120 will continue to provide strong support, but below that would allow a move to 1100, a break of which could then see a run towards 1090 and even to 1070. While the weekly charts suggest that this could eventually happen, the dailies are now becoming oversold, and the 4 hour charts hint at the chance of another bounce, providing better levels to sell into.

If so, the topside will see offers at 1145/50 and again at 1160/65. Selling rallies is preferred although if the China/US thing gets serious, don’t be caught short!

24 Hour: Neutral

Medium term: Prefer to sell rallies

 

Resistance Support
1172 (23.6% of 1337/1122) 1123/22 15 Dec low/(76.4% of 1046/1375)
1165 14 Dec high /12 Dec high 1108 28 Jan low
1157 Minor 1100 Minor
1150 Minor 1090 Minor
1141/44 Friday high 15 Dec high 1071 14 Jan low
SILVER 16.11

Silver jumped around either side of 16.00 on Friday, leaving the outlook unchanged.

The short term momentum indicators are now mixed, suggesting further choppy trade but the dailies are heading lower, and below 15.80 could quickly see a run towards 15.35/30, below which 15.00 and 14.80 would attract.On the topside, 16.25/30 will again provide minor resistance, beyond which we could see a squeeze towards 16.60, above which would then open the way towards 17.00, albeit doubtful today. Selling rallies is preferred.

24 Hour: Prefer to sell rallies

Medium term: Neutral

 

Resistance Support
17.05 (38.2% of 18.98/15.88) 15.90 Friday low
16.88 200 HMA 15.50 Minor
16.60 (23.6% of 18.98/15.88) 15.35/38 11 April low/(76.4% of 13.64/21.13)
16.45 Minor 15.00 Minor
16.27 Friday high 14.78 1 April low
OIL (WTI) 51.99

Oil prices settled higher on Friday, as traders became emboldened to the fact that the Non-OPEC producers seem to be ready to adhere to their promise to cut back output.

 On the topside, above Friday’s 52.06 high, the next resistance will be seen at 52.50/70 and then again at the 15 Dec high of 52.75. Beyond there could see a return to the recent 54.48 peak although this looks some way off at this stage. Support will now arrive at the neckline of the major reverse head-shoulder formation, at 51.15, and below that at Friday’s low of 50.48. Under there could see a return to 50.00/49.75, which should be strong support, but below which could see an acceleration towards 48.00/50, below which could see a run to 46.50/00

24 Hour: Neutral

Medium term: Neutral

 

Resistance Support
54.48 12 Dec high 50.48 Friday low
53.30 Minor 49.92 15 Dec low
52.75 14 Dec high 49.58 8 Dec low
52.40 Minor 49.00 Minor
52.06 Friday high 48.30 (50% pivot of 42.18/54.48)

EURUSD: 1.0449

The Euro traded sideways into the weekend, squeezing a little higher against the dollar as traders took profit following the recent sell-off but leaving the overall outlook unchanged.

In the short term, 1.0365/1.0400 will provide support ahead of the 1.0334 Jan 2013 low although, as we said before, with the daily/weekly momentum indicators picking up downside momentum a test of parity would seem to be a matter of time. Indeed the head/shoulder formation, seen on the weekly charts, suggests that eventually we are heading much, much lower. In the meantime, selling rallies appears to be the plan. The short term momentum indicators still hint at the chance of a squeeze back towards 1.0490/1.0550, but I would not be looking for too much more in the short term.

24 Hour: Neutral – Prefer to sell rallies

Medium term: Mildly bearish

 

Resistance Support
1.0600 Minor 1.0400 Friday low
1.0560 (38.2% of 1.0365/1.0872) 1.0365 15 Dec low
1.0520 Minor 1.0334 Jan 2003 low
1.0485 (23.6 of 1.0365/1.0872) 1.0300 Minor
1.0473 Minor 1.0250 Minor

Economic data highlights will include:

M: German IFO Business Climate/Expectations, BuBa Monthly Report US Markit Services/Composite PMIs,

T: German PPI, EU Current Account, Provisional Consumer Confidence, US API Weekly Crude Oil Stock Inventory

W: Existing Home Sales, EIA Crude Oil Stocks Weekly Change

T: Chicago Fed National Activity Index, US Personal Consumption/Expenditure/Income, Jobless Claims Q3 GDP, Durable Goods Orders, House Price Index

F: German Consumer Confidence, US Michigan Consumer Sentiment Index, New Home Sales, Baker Hughes Oil Rig Count

Meta Trader
EURUSD: 4 Hour

euro

euro1


USDJPY: 117.98

US$Jpy was on the defensive on Friday following the escalation of tensions in the South China Sea, and unable to make any further gains beyond Thursday’s high of 118.65, the pair is now trading back at 118.00 after having recovered from a dip to 117.46.

Although technical picture suggests that the dailies remain overbought, buying dips still seems to be the plan, with a SL placed under the rising trend support, now at 115.65. It may be that we spend a while chopping around below 120.00, allowing the dailies to unwind their overbought condition, and there are easier pairs to trade right now but looking further out, with the weeklies pointing strongly higher, a retest of 125.85 (7 June 2015 high) would seem to be on the cards.

24 Hour: Prefer to buy dips

Medium term: Mildly bullish

 

Resistance Support
120.00 Psychological 117.46 Friday low
119.35 (76.4% of 125.85/98.94) 117.15 Minor
118.80 Descending trend resistance 116.50 Minor
118.65 15 Dec high 116.00 Minor
118.42 Friday high 115.65 Rising trend support

Economic data highlights will include:

M: BOJ Interest Rate Decision/Statement/Press Conference

T:

W: All Industry Activity Index

T: Foreign Bond/Stocks Investment

F: Holiday

Meta Trader
USDJPY: 4 Hour

yen


GBPUSD: 1.2484

Cable recovered from the week’s lows of 1.2375 to reach 1.2500 on Friday, and with the 4 hour momentum indicators now pointing a bit higher we could yet see a squeeze towards the previous trend support – now resistance – at around 1.2600. If we do, then with the US$ looking to remain underpinned it may well be a decent sell opportunity as Cable is unlikely to maintain its strength in the face of any weakness in the other majors. Overall, the longer term charts do not look all that negative for Sterling and as we said on Friday, a short EurGbp position might be the better trade.

24 Hour: Mildly Bullish

Medium term: Mildly bearish

 

Resistance Support
1.2640 (76.4% of 1.2676/1.2375) 1.2450 Minor
1.2590 200 HMA /(61.8% of 1.2676/1.2375) 1.2400 Minor
1.2565 15 Dec high 1.2382/75 Friday low/15 Dec low
1.2550 (50% pivot of 1.2676/1.2375) 1.2300 (50% pivot of 1.1821/1.2775)
1.2510 Friday high /(61.8% 1.2676/1.2375) 1.2190 (61.8% of 1.1821/1.2775)

Economic data highlights will include:

M:

T: CBI Distributive Trade Survey – realised

W: PSNBR

T: Consumer Confidence, Q3 GDP, Total Business Investment

F:

Meta Trader
GBPUSD: 4 Hour

gbp


USDCHF: 1.0265

US$Chf has eased back from last week’s trend high of 1.0343, and in the short term further consolidation looks likely, but with the dailies leaning bullish, I think buying dips, with a SL placed, either tight at 1.0220 or preferably  under the  1.0140, 61.8% Fibo support may be the way to go.

In the longer term, the dollar has taken out all the nearby resistance levels and there is now not too much to stop it heading on towards 1.0600+. Short term dips are likely, where the downside looks supported at 1.0265/75 and 1.0220, with SL best placed below the 1.0195 low.

24 Hour: Neutral – Prefer to buy dips

Medium term: Bullish

                                                                

Resistance Support
1.0620/28 (76.4% of 1.1695/0.7080)/8 Aug 2010 high 1.0240 Friday low
1.0500 Minor 1.0225 (38.2% of 1.0019/1.0343)
1.0400 Minor 1.0195 100 HMA
1.0343 15 Dec high 1.0180 (50% of 0.9549/1.0343)
1.0310 Friday high 1.0140 (61.8% of 0.9549/1.0343)

Economic data highlights will include:

M:

T: Trade Balance

W: Q4 Quarterly Bulletin

T:

F:

Meta Trader
USDCHF: 4 Hour

capture


AUDUSD: 0.7298

The Aud got hammered in late US trade on Friday, falling hard to a low of 0.7265 ahead of a minor bounce, to finish the week at 0.7300. The hourly charts do suggest some minor bullish divergence, and if so, selling into rallies towards 0.7330 and even 0.7360 would seem to be the way forward. The 4 hour/daily momentum indicators are both heading lower so we may not see much of a bounce and a break of Friday’s low would then open the way to 0.7220/0.7200. Further out, I think we may have started the move to 0.7000 and eventually lower. Given the potential for diverging monetary policy between the RBA/Fed heading into 2017 as well as the increasing chance of a cut in the Australian AAA credit rating, we could eventually be look ing towards a move to the January lows of 0.6825. Watch out for the MYEFO, due tomorrow

24 Hour: bearish – Prefer to sell rallies

Medium term: Bearish

 

Resistance Support
0.7445 200 HMA 0.7290 Minor
0.7420 Minor 0.7265 Friday low
0.7395 (50% of 0.7524/0. 7265) 0.7250 Minor
0.7364/68 (38.2% of 0.7524/0. 7265)/Friday high 0.7218 3 June low
0.7325 (23.6% of 0.7524/0.7265) 0.7200 2 June low

Economic data highlights will include:

M: WBC Consumer Survey (Q4)

T: CB Leading Economic Index, MYEFO, WBC Leading Indicator, RBA Minutes, China Leading Economic Index

W:

T:

F:

Meta Trader
AUDUSD: 4 Hour

aud

aud-1


NZDUSD: 0.6958

As with the Aud, the Kiwi got hammered in late US trade on Friday, falling hard, to a low of 0.6930 ahead of a minor bounce, to finish the week at 0.6960. The hourly charts suggest some minor bullish divergence, and if so, selling into rallies towards 0.7000 and even 0.7040 would seem to be the way forward. The 4 hour/daily/weekly momentum indicators are all heading lower though, so we may not see much of a bounce, and a break of Friday’s low would then open the way to the major rising trend support at 0.6820. Further out, given the look of the head/shoulder formation (daily chart- below) I think we may have started the move to the 0.6450 objective, albeit that it will take a while to get there. .

24 Hour: bearish – Prefer to sell rallies

Medium term: Bearish

 

Resistance Support
0.7083 (50% of 0.7238/0. 6930) 0.6930 Friday low
0.7047 (38.2% of 0.7238/0. 6930) 0.6915 (61.8% of 0.6347/0.7484)
0.7025 Minor 0.6890 Minor
0.7002 (23.6% of 0.7238/0.6930) 0.6840 Minor
0.6970 H/S Neckline 0.6820 Rising trend support

Economic data highlights will include:

M: Building Permits, ANZ Activity Outlook, Business Confidence

T: Global Dairy Trade Index

W: Trade Balance

T: Q3 GDP

F:

Meta Trader
NZDUSD: 4 Hour

nzd

nzd1

The post 19 Dec: US$ mixed. Aud, Kiwi lower. Liquidity becoming thin, but a heavy US data schedule this week. appeared first on FX Charts Daily.