Daily Forex Preview – 10/12

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The markets staged a turn-around late into the US session yesterday with the Greenback weakening across the board. USDJPY declined to make an intraday low to 117.944 while the EURUSD rallied as much as 1.2446 highs before easing off for the day. The bullish momentum looks set to continue through to today’s trading session. There was no particular reason as to the sudden declines in the Greenback as the few fundamentals from the US were relatively better than expected. It must however be noted that the US Dollar Index was trading near a major multi-year resistance level, which could be one of the reasons for the sudden decline.

The Euro single currency was bullish through the start of yesterday, proving the support level near 1.225 levels to be quite strong. The British Sterling was weaker on account of disappointing industrial and manufacturing data. But the Cable managed to rally later in the day due to the broad weakness in the Greenback.

Today’s economic calendar is quiet for most of the European and US trading sessions with the RBNZ overnight cash rate statement being the only sole market moving event for today.

Fundamentals Recap – December 9, 2014

  • UK BRC Retail sales monitor y/y 0.9%
  • NAB Business confidence 1 vs. 5 previously
  • Japan prelim machinery tools orders m/m 36.6%
  • German trade balance 20.6bn vs. 18.1bn; French trade balance -4.6bn vs. -4.5bn
  • UK manufacturing production m/m -0.7% vs. 0.2%; industrial production m/m -0.1% vs. 0.3% estimates
  • US NFIB small business index beats estimates rising to 98.1
  • NIESR GDP estimates, UK at 0.7%
  • ECB officials speeches
  • US JOLTS job openings 4.83Mn vs. 4.81Mn
  • IBD/TIPP Economic optimism 48.4 vs. 47.2
  • US Wholesale inventories m/m 0.4% vs. 0.1%

Fundamentals – December 10, 2014

  • Australia Westpac consumer sentiment -5.7%
  • Japan BSI manufacturing index 8.1 vs. 13.1
  • Japan PPI y/y 2.7% vs. 2.7% estimates
  • Australia home loans m/m 0.3% vs. 0.1% estimates
  • China CPI y/y 1.4% vs. 1.6%; PPI y/y -2.7% vs. -2.3%
  • Japan consumer confidence 37.7 vs. 39.6
  • RBNZ Official cash rate 3.5%
  • RBNZ rate statement

EURUSD Daily Pivots

R3 1.2605
R2 1.2526
R1 1.2449
Pivot 1.237
S1 1.2294
S2 1.2214
S3 1.2138

 EURUSDH1

As noted in our yesterday’s analysis, EURUSD did indeed rally to 1.244 levels but saw a sharp reversal near this major resistance level. However, the fact that the declines were contained to the minor support, now the daily pivot is indicative of further upside push in EURUSD. A break above the resistance at 1.242 could see EURUSD target the next resistance at 1.25 levels. Alternatively, if the resistance at 1.244 holds, we could expect to see gradual declines back to the major support at 1.227

USDJPY Daily Pivots

R3 124.213
R2 122.609
R1 121.153
Pivot 119.549
S1 118.093
S2 116.489
S3 115.033

USDJPYH1

USDJPY’s decline was predictable to the untested support region of 118.975 levels. With price making a large downward spike through to 118.332, USDJPY could possibly look towards a potential choppy price action today with little movement. A break of the down sloping trend line could however put USDJPY back to its bullish rally. To the downside, the next major support level comes in at 117.572.

GBPUSD Daily Pivots

R3 1.5804
R2 1.576
R1 1.5713
Pivot 1.5669
S1 1.5623
S2 1.5578
S3 1.5531

GBPUSDH4

Yesterday’s price action put the GBPUSD back into the range zone seen for the past 3 and half weeks. The resistance level of 1.5723 must be clearly broken followed by a break of the trend line in order to ascertain any bullish price action in the Cable. Alternatively, the lower end of the range at 1.561 and a potential test of the same level for resistance need to be tested to confirm further downside moves.

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Deepak Tiwari, a law graduate, has been working as a journalist for six years now. He currently writes on Bitcoin, economic, and Forex related news at ForexMinute, the brand new financial news portal which is making waves among Forex traders around the globe for the innumerable Forex resources it offers for readers, traders and brokers. His other specialties include writing on law & governance, finance, internet marketing, careers, politics, international relations & diplomacy, etc.