Daily Global Macro Technicals Trend Bias/Key Levels (Mon 15 Jan)

FX – Short-term USD weakness remains intact

  • EUR/USD –Rallied as expected above the 1.2000 tightened key short-term support and hit the 1.2125/2185 resistance/target (printed a high of 1.2218 in last Fri, 12 Jan U.S. session). Based on Elliot Wave/fractal analysis the short-term (minor degree wave iii) bullish impulsive upleg from 12 Dec 2017 low remains intact but risk of a minor pull-back at this juncture due to an extreme overbought reading seen in the 4 hour Stochastic oscillator. Maintain bullish bias in any dips above the tightened key short-term support now at 1.2075 (former minor swing high area of 02/05 Jan 2018 + 50% Fibonacci retracement of the recent rally from 11 Jan 2018 low to last Fri, 12 Jan 2018 high) for another potential upleg to target the next near-term resistance at 1.2370/80 (congestion zone of Nov/Dec 2014 + Fibonacci projection cluster). On the other hand, a break below  1.2075 should  negate the bullish tone to see a deeper pull-back to retest 1.1930/1916 medium-term support.
  • GPB/USD – Bullish breakout from 1.3570 upside trigger level as expected and met the 1.3660/3710 resistance/target as expected (printed a high of 1.3744 in last Fri, 12 Jan U.S. session). Risk of minor pull-back at this juncture within a medium-term bullish structure in place since24 Aug 2017 low  as the 4 hour Stochastic oscillator has reached an extreme overbought level.  Maintain bullish bias in any dips above 1.3600 tightened key short-term support (former swing high areas of 15 Sep 2017/03 Jan 2018) for another potential upleg to target the next resistance at 1.3920/3960 (upper boundary of medium-term ascending channel from 16 Jan 2017 low + Fibonacci projection cluster). However, failure to hold above 1.3600 should negate the bullish tone for a deeper pull-back to retest 1.3460 support (11 Jan 2018 minor swing low area).
  • AUD/USD – Rise in progress as expected and coming close to 0.7970 resistance/target. No clear signs of bullish exhaustion. Maintain bullish bas above tightened key short-term support now at 0.7870 (lower boundary of medium-term ascending channel from 09 Dec 2017 + former minor swing high areas of 05/06 Jan 2018) for a further potential push up towards 0.7970 before targeting the next resistance at 0.8040/8060 (Fibonacci projection cluster + medium-term swing high areas of 27 Jul/20 Sep 2017). On the other hand, a break below 0.7870 should negate the bullish tone to see a deeper pull-back to retest the 10 Jan 2018 minor swing low area of 0.7800.
  • NZD/USD – Last Fri, 12 Jan pull-back managed to hold at the predefined 0.7210 tightened key short-term support as expected (printed a low of 0.7219 in last Fri, U.S. session). Maintain bullish bias above 0.7210 support for a further potential upleg to target the next near-term resistance at 0.7340/7370 (medium-term ascending channel resistance from 08 Dec 2017 + medium-term swing  high area of  20/22 Sep 2017 + Fibonacci cluster). On the other hand, a break below 0.7210 sees further potential downside towards 0.7140 support (minor swing low area of 10 Jan 2018 + 23.6% Fibonacci retracement of the on-going medium-term rally from 08 Dec 2017 low).
  • USD/JPY – An hourly close below 110.80 has validated further weakness. Flip back to bearish bias below 111.70 key short-term resistance (swing high area of 12 Jan 2018 + minor ascending trendline from 08 Jan 2018 for another potential downleg to target the next near-term support of 110.40/15 (lower boundary of a medium-term descending channel from 06 Nov 2017 high + Fibonacci cluster). However, a clearance above 111.70 should invalidate the bearish scenario for a potential squeeze up to retest 112.00/112.15 (the former swing low areas of 06 /15 Dec 2017 & 02 Jan 2018.

Stock Indices (CFD) – Mix bag

  • US SP 500 – Rallied towards the 2780 medium-term resistance as expected (printed a high of 2788 in last Fri, 12 Jan U.S. session). Maintain bullish bias in any dips above tightened key short-term support now at 2778 (the steep minor ascending trendline from 10 Jan 2018 minor swing low + close to 23.6% Fibonacci retracement of the recent on-going up move from 10 Jan 2018 low) for a potential push up towards the 2820 upper limit of the medium-term resistance.  On the other hand, a break below 2778 should negate the bullish tone to trigger a corrective pull-back towards the next support at 2756 (former minor swing high area of 10 Jan 2018).
  • Japan 225 – Traded sideways, maintain bullish bias above 23460 key short-term support with 23790 as the upside trigger level to reinforce the start of another potential upleg to target the next resistance at 24200 ( Fibonacci projection cluster + exit potential of the recent triangle range bullish breakout). On the other hand, a break below 23460 sees further potential downside towards the 23325 key medium-term support (see weekly technical outlook report).
  • Hong Kong 50 – Rallied as expected and coming close to the 31750 resistance/target. The hourly Stochastic oscillator has flashed a bearish divergence signal at its overbought region which indicates the recent upside momentum of price action has started to slow-down. Prefer to turn neutral now between 31750 & 31230 (former minor swing high area of 10 Jan 2018).
  • Australia 200 – 6026 key medium-term support remains the level to watch  (see weekly technical outlook) and the bulls to break above 6109 (today, 15 Jan Asian session current intraday high) to reinforce the start of another potential upleg to retest 6160 before targeting the next near-term resistance at 6190 (1.618 Fibonacci projection of the up move from 06 Dec 2017 low). However, a break below 6026 should see a deeper corrective slide to retest the recent triangle range support of  5940/10.
  • Germany 30 – Traded sideways above the 13000 key medium-term support. No change, maintain neutrality stance between 13000 & 13350. Only a break above 13350 will increase the odds of another potential upleg to target the 13530/560 near-term resistance (07 Nov 2017 swing high area) in the first step.

Commodities –Further potential upside in Gold

  • Gold – Rise in progress as expected. Tightened key short-term support to 1320 (last Fri, 12 Jan swing low + medium-term ascending channel from 12 Dec 2017 low) for a further potential push up towards 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 negate the bullish tone to see a slide to retest 1308/1305 support next (minor swing low area of 09/10 Jan 2018).
  • WTI Crude (Feb 2018) – Rise in progress as expected.  Tightened key short-term support to 63.00 (last Fri, 12 Jan minor swing low + psychological) for a further potential push up towards the next significant resistance of 65.20 (former major swing lows area of Sep 2009/May 20110). However, failure to hold above 63.00 should see a minor corrective pull-back towards 59.40/58.95 (former swing high area of 24 Nov 2017 + medium-term ascending channel support from 31 Aug 2017 low).

*Levels are obtained from City Index Advantage TraderPro platform

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