24 Feb: Forecast: US$ /Majors

By | February 24, 2017


EURUSD: 1.0581

EurUsd is more or less unchanged today after a choppy session (1.0537/95) leaving the medium term outlook unchanged.

The short term momentum indicators still look a little more positive, and on the topside, minor resistance will be seen at the session high ahead of 1.0605/10 and 1.0675/80.  Above here looks unlikely today, but we could potentially see a move back to 1.0700 and above. Near term support will arrive at the session low, and then again as we approach 1.0500 and the 1.0493 22 Feb low, below which there is not too much support ahead of the 11 January low of 1.0453. Below that there is again too much to support it ahead of the 3 Jan low of 1.0340 although that will be for another day. For today, with the 1 and 4 hour charts looking mildly positive, a squeeze back towards 1.0600/30 would note really surprise but selling into rallies remains the preferred medium term theme.

24 Hour: Prefer to sell rallies Medium Term: Mildly bearish
Resistance Support
1.0700 22 Feb high 1.0537 Session low
1.0678 16 Feb high 1.0493 22 Feb low
1.0635 (76.4% of 1.0678/1.0493) 1.0480 Minor
1.0607/10 (61.8% of 1.0678/1.0493)/ Descending trend resistance 1.0453 11 Jan low
1.0595 Session high 1.0420 Minor

Economic data highlights will include:

US Michigan Consumer Sentiment Index, New Home Sales, Baker Hughes Oil Rig Count

USDJPY: 112.73

US$Jpy is a little heavy on Thursday having broken below the 113.00 pivot, but holding above the 112.40 Fibo support.

The short term momentum indicators and the daily charts still give little hint either way so it could end up being another choppy session using 113.00 as a pivot. If wrong, then below the session low could see a run back towards 112.35/40 and to 112.00 although this seems unlikely at this stage.  On the topside, back above 113.00 could see a run towards the session high of 113.45 and then to 113.72, the 22 Feb high. Above this would see sellers at 114.00/05 and then at 114.40 ahead of the recent trend high of 114.95. If 114.95 is taken out – unlikely today – there is little to stop the dollar heading on to 115.15/20, above which 115.60 would attract.  A choppy session looks the most likely outcome. Buying dips towards 112.40 might be a plan, with SL placed under 112.00.

24 Hour: Neutral Medium Term: Prefer to buy dips
Resistance Support
114.04 (61.8% pivot of 114.95/112.61) 112.54 Session low
113.77/80 21 Feb high/(50% of 114.95/112.61) 112.38 (76.4% of 111.58/114.95)
113.45 Session high 112.00 Minor
113.20 100 HMA 111.70 Minor
113.00 Pivot 111.58 7 Feb low

GBPUSD: 1.2547

Cable broke minor resistance, triggering stops at 1.2480 and 1.2500 on Thursday, and has headed to a high of 1.2561 before settling at 1.2540.

Having broken to the topside, further positive momentum seen in the 4 hour charts could now take Cable on to 1.2600 and to 1.2620, beyond which could then revisit the 2 Feb high of 1.2705, although probably not today..  On the downside, support will be seen at 1.2500 and then again at the session low and again at 1.2400. Look for 1.2500/1.2600 to cover it today, with a preference to buying dips.

24 Hour: Mildly bullish Medium Term: Neutral
Resistance Support
1.2620 (76.4% of 1.2700/1.2346) 1.2525 Minor
1.2600 Minor 1.2500 Minor
1.2582 7 Feb high 1.2465 200 HMA
1.2570 (61.8% of 1.2700/1.2346) 1.2427 Session low

USDCHF: 1.0064

US$Chf is a little lower today after a relatively tight 1.0053/1.0115 range.

While the dailies still look mildly constructive, the short term momentum indicators are pointing a little lower so a retest of the session lows would seem possible, below which we might head back towards minor support at 1.0020 ahead of the 1.000 pivot. Below here may be tricky, but if wrong we would break below the rising trend support and could see a run back to the 17 Feb low of 0.9965.  On the topside, resistance will be seen at the session high ahead of the 1.0140, 22 Feb high. Beyond there will see decent sellers at 1.0160 and at 1.0200, although this looks likely to be delayed for a while. Buying dips still seems to be the plan given that the dailies look positive, but keep a SL below 1.0000.

24 Hour: Mildly bearish – Prefer to buy dips Medium Term: Prefer to buy dips
Resistance Support
1.0200 Minor 1.0053 Session low /200 HMA
1.0160 (61.8% of 1.0343/0.9861) 1.0023 21 Feb low
1.0140 22 Feb high 1.0010 20 Feb low /Rising trend support
1.0115 Session high 0.9965 17 Feb low
1.0085 Minor 0.9950 Minor

AUDUSD: 0.7713

A soft US$ has allowed the Aud to break above the previous resistance seen just above 0.7700, in heading up to 0.7740 to make a new 2017 high before  reversing to finish the day at 0.7715.

The short term momentum indicators still point mildly higher, so further gains towards the descending trend resistance  at 0.7750 could be on the cards, beyond which could then head to the November high of 0.7777. On the downside, the initial support will arrive at 0.7700 and then at 0.7675/80 and the session low of 0.7665, below which could then see a move to 0.7650 although this seems a little doubtful.  For the coming session, while mildly bullish, I prefer to sell into strength near 0.7750, with a SL placed above 0.7777.

24 Hour: Prefer to sell rallies Medium Term: Neutral
Resistance Support
0.7834 21 April ’16 high 0.7690 Minor
0.7800 Minor 0.7665 Session low
0.7777 8 Nov high 0.7649 21 Feb low
0.7750 Descending trend resistance 0.7636 16 Feb low
0.7740 Session high 0.7617 14 Feb low

NZDUSD: 0.7228

The Kiwi is back above 0.7200, having traded up to a high of 0.7246 and looking underpinned ahead of the Friday session.

The short term momentum indicators are pointing a little higher, suggesting a possible retest of the session high and the 50% pivot of the decline from 0.7375, at 0.7355. Above her would then see a run to 0.7280/.07300 although above here seems doubtful.. On the downside, the daily indicators remain mildly bearish, so selling into near term strength is still preferred, looking for a run back towards 0.7200 and the session low of 0.7173, below which would test 0.7130 and the very strong support at 0.7120/15, albeit probably not today.

24 Hour: Mildly bullish – Prefer to sell rallies Medium Term: Prefer to sell rallies
Resistance Support
0.7317 (76.4% of 0.7375/0.7133) 0.7200 Minor
0.7300 Minor 0.7173 Session low
0.7280 (61.8% of 0.7375/0.7133) 0.7145 22 Feb low
0.7252 (50% of 0.7375/0.7133) 0.7129 21 Feb low
0.7246 Session high 0.7120/15 200 DMA/100 DMA/55 DMA Converging/(50% of 0.6857/0.7375)