Daily Global Macro Technicals Trend Bias/Key Levels (Fri 19 Jan)

FX –  USD is still hovering above minor key supports

  • EUR/USD – Pushed up but still trading below the 1.2305 key short-term resistance. No change, maintain bearish bias with 1.2165 (yesterday, 18 Jan low) as the downside trigger to reinfore another potential minor corrective downleg towards the next near-term supports at 1.2125 follow by the 1. 1.2090/2070 support zone (former swing highs area of Sep 2017/04 Jan 2018). On the flipside, a clearance above 1.2305 should see bulls back in control for a continuation of the extension upleg towards the next resistance zone at 1.2380/2415 (upper boundary of a major ascending channel from 03 Jan 2017).
  • GBP/USD – Still holding below the 1.3940 key short-term resistance, maintain bearish bias with 1.3807 as downside trigger level (former minor swing high areas of 15/17 Jan 2018) to reinforce the start of a minor corrective downleg to target the next near-term supports at 1.3745 (minor swing low area of  16 Jan 2018) follow by 1.3700 next (38.2% Fibonacci retracement of the up move from 16 Dec 2017 low to yesterday high + median line of the medium-term ascending channel from 03 Nov 2017 low). On the other hand, a break above 1.3940 should see a further potential up move towards the next resistance at 1.4130 (swing low area of 03 Apr 2016 + upper boundary of the major ascending channel from 15 Jan 2017 low).
  • AUD/USD – Pushed up and it is now back at 0.8023 (17 Jan, U.S. session) high which  is just below the 0.8040/60 key short-term resistance zone.  The 4 hour Stochastic  oscillator is now hovering at an extreme overbought level but daily candlestick from yesterday’s price action is not showing signs of clear bullish exhaustion yet. Mix elements, prefer to turn neutral now between 0.8060 &  0.7940. Only a break below 0.7940 is likely to open up scope for a minor corrective decline towards the next near-term support at 0.7900/7885 (former medium-term swing high area of  13/19 Oct 2017 + medium-term ascending channel support from 08 Dec 2017 low + 23.6% Fibonacci retracement of the whole up move from 08 Dec 2017 low to yesterday high). On the flipside, a clearance above 0.8060 should put the bulls back in control for a further potential rally towards the next resistance at 0.8125 (medium-term swing highs at 10 May 2015 & 03 Sep 2017).  
  • NZD/USD – Still hovering below the 0.7340 key short-term resistance. No change, maintain bearish bias with 0.7235 as the downside trigger level (medium-term ascending channel from 08 Dec 2017 low) to reinforce a potential minor corrective decline towards the next near-term support of 0.7140 (swing low of 09 Jan 2018 + 38.2% Fibonacci retracement of the up move from 08 Dec 2017 low to yesterday high). However, a clearance above 0.7340 should see the continuation of the extension up move to target the next resistance at 0.7435 (medium-term swing high of 20 Sep 2017).
  • USD/JPY – Pull-backed and tested the 110.85 tightened key short-term support without an hourly close below it. Maintain bullish bias above 110.85 support for another potential minor upleg to target the resistance of 111.70/80 with a potential extension towards 112.10 (former medium-term swing low areas of 06 Dec/15 Dec 2017/02 Jan 2018 + Fibonacci cluster). On the other hand, failure to hold above 110.85 shall invalidate the recovery phase to see as slide back towards 110.00 and below it  opens up scope for an extension of the drop towards the next support at  108.15/108.00 (medium-term swing low areas of 17 Apr/29 Aug 2017).

Stock Indices (CFD) – Still holding above supports

  • US SP 500 – Traded sideways above the 2791 tightened key short-term support.  Maintain bullish bias above 2791 support  for a further potential push up towards the first medium-term resistance at 2820 (see latest weekly technical outlook). On the other hand, a break below 2791 should negate the bullish tone to see a slide back to retest the 2780/68 zone.
  • Japan 225 – A sudden pushed down below the 23890 tightened key short-term support was seen in the last 2nd hour of yesterday, 18 Jan Japanese cash stock market trading session without any key economic data release. Interestingly, the sell-off was contained by the minor range support of 23650 in place since 10 Jan 2018.  Mix elements in the short-term, prefer to turn neutral now between 23650 & 23900 (close to yesterday, 18 Jan U.S. session high). Only a break above 23900 is likely to put the bulls back in control for another round of potential upleg to target the near-term resistance of 24200 (Fibonacci projection cluster + exit potential of the recent triangle range bullish breakout).
  • Hong Kong 50 – Recalled that we had turned neutral yesterday due to mix elements. Right now, the short-term upside momentum of price action has resurfaced as seen from the hourly Stochastic oscillator that has started to inch higher towards its overbought region. Flip back to bullish bias in any dips above 31850 key short-term support (yesterday, 18 Jan Asian session low + minor ascending channel support from 21 Dec 2017 low) for a further potential push up to target 32370 (upper boundary of the minor ascending channel from 21 Dec 2017 low + 1.00 Fibonacci projection from 15 Jan minor low to 16 Jan 2018  minor low projected from 17 Jan 2018 low).
  • Australia 200 – Traded sideways around the 6026/5996 key medium-term support/excess. No change, maintain neutrality stance between 6026/5996 & 6042. Only an hourly close above 6042 is likely to revive the bullish tone for a potential push up towards 6109 (the minor swing high of 15 Jan 2018 + medium-term upside trigger)
  • Germany 30 – Pushed up from the 13130 minor support but has not break above the 13350 minor range resistance from 16 Jan 2018. No change, maintain neutrality stance between 13130 & 13350. Only a break above 13350 will increase the odds of another potential push up to target the 13530/560 near-term resistance (07 Nov 2017 swing high area) in the first step.

Commodities – Gold still at risk of a minor corrective decline

  • Gold – Maintain neutrality stance between 1320 & 1340 (minor swing high of 17 Jan 2018 seen in the U.S. session).  An hourly close above 1340 is likely to shift the focus back to the bulls for another round of potential upleg to target 1357 (swing high of 08 Sep 2017) before the significant resistance of 1375/1378 (major upside trigger level for a potential multi-month up move). On the other hand, failure to hold above 1320 should trigger a corrective slide to retest 1308/1305 support(minor swing low area of 09/10 Jan 2018).
  • WTI Crude (Feb 2018) – Mix elements at this juncture, prefer to maintain neutrality stance between 65.20 & 63.00.  Bears need to have a break below 63.00 to trigger a potential minor corrective pull-back towards the 60.50/59.50 support zone (50%/61.8% Fibonacci retracement of the recent rally from 14 Dec 2017 low to 15 Jan 2018, U.S. session high).

*Levels are obtained from City Index Advantage TraderPro platform

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.