The Fed announcement tonight. No change expected but the “language” is what FX traders will be listening to. Dean got out of the Kiwi for a small loss and sees opportunities in a few pairs. EURUSD, USDCAD, USDCHF and USDJPY.
Dean's Daily FX Update – 01 February 2017
In the Zone
- EURUSD
- USDCAD
- USDJPY
- USDCHF
Noteworthy News
- There are a lot of concerns around the populism that President Trump is currently delivering, the market is clearly also struggling with the same concept, perhaps his pro-business agenda will settle the market – if delivered.
Recap
President Trump continues to shock the market in the most unconventional of ways, I fear that he may polarize the US and other regions of the world. It cannot be long before the Republican Senators start crossing the floor on certain policies. In the firing line yesterday were Germany, China and Japan who were all accused of devaluing their currency at the detriment of the US.
In the case of Germany and Japan, their austerity measures are not too dissimilar to what the US went through 5-6 years ago. At that point the US devalued the dollar and I think President Trump needs to be cognisant of that. None the less, the EURUSD, despite a dovish tone out the ECB still gained 100 pips yesterday.
GBPUSD looked vulnerable for most of yesterday, but what had begun as a 100 pip drop quickly turned into a 100 pip gain as the Trump headlines gripped the market. We closed the day at 1.2600 and I think that this may be a tough hurdle to break, I suspect that there may be some profit taking this morning and for the USD to make some sort of recovery.
The theme across all the pairs are the same, as normal trading ranges were broken by Donald Trump headlines that clearly were intended to weaken the dollar. Having a look around the major pairs this morning it is clear that the dollar is at a junction of sorts – technically it seems as though the dollar should recover much of yesterday’s losses, but we live in a fundamental world at present.
There is major event risk in the form of a FOMC meeting today and as usual I will sit the market out today. The most important thing about the meeting today will be around the language of the message and to clues around how many interest rate hikes we can expect in the US today.
Daily Ranges 01/02/2017
Majors
EURUSD
Resistance 1.0780 – 1.0810
Support 1.0710 – 1.0690
GBPUSD
Resistance 1.2560 – 1.2580
Support 1.2480 – 1.2450
AUDUSD
Resistance 0.7580 – 0.7590
Support 0.7545 – 0.7530
NZDUSD
Resistance 0.7310 – 0.7340
Support 0.7260 – 0.7240
USDCAD
Resistance 1.3095 – 1.3120
Support 1.3036 – 1.3020
USDJPY
Resistance 113.80 – 114.00
Support 112.50 – 112.00
USDCHF
Resistance 0.9940 – 0.9960
Support 0.9895 – 0.9970
Rand
USDZAR
Resistance 13.5280 – 13.5610
Support 13.4520 – 13.4130
EURZAR
Resistance 14.5604 – 14.6020
Support 14.4545 – 14.4120
GBPZAR
Resistance 16.9970 – 17.0200
Support 16.8308 – 16.7970
Minors
AUDCAD
Resistance 0.9910 – 0.9920
Support 0.9850 – 0.9830
AUDJPY
Resistance 86.05 – 86.20
Support 85.30 – 85.10
EURCHF
Resistance 1.0680 – 1.0700
Support 1.0640 – 1.0620
EURGBP
Resistance 0.8600 – 0.8610
Support 0.8550 – 0.8530
EURJPY
Resistance 122.20 – 122.40
Support 121.40 – 121.10
GBPJPY
Resistance 142.60 – 142.80
Support 141.20 – 141.00
GBPCAD
Resistance 1.6430 – 1.6460
Support 1.6330 – 1.6310
GBPCHF
Resistance 1.2440 – 1.2460
Support 1.2400 – 1.2380
Indices
DE30
Resistance 11700 – 11750
Support 11600 – 11550
UK100
Resistance 7160 – 7180
Support 7100 – 7090
US500
Resistance 2290 – 2300
Support 2270 – 2250
US30
Resistance 19900 – 20000
Support 19800 – 19600
SA40
Resistance 46700 – 46900
Support 45900 – 45700
Commodities
BRENT
Resistance 56.20 – 56.40
Support 55.20 – 55.00
XAUUSD
Resistance 1205.00 – 1212.00
Support 1195.00 – 1190.00
XAGUSD
Resistance 17.40 – 17.50
Support 16.90 – 16.70
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