The report this morning will be in a slightly different form, the reason is that from a technical level all the major pairs are in range this morning and so I have covered them in the morning video. Instead I want to recap some of the major themes that come out of a very robust fundamental day on Tuesday. With the exception of FOMC Member Bullard, it would definitely seem as though the Fed are trying to communicate that there could be a hike not too far away. This was the initial catalyst for the USD run yesterday as the next FOMC meeting looms large, the remainder of the move was initiated by President Trumps address to Congress.
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Dean's Daily FX Update – 01 March 2017
In the Zone
- EURUSD
- GBPUSD
- AUDUSD
- NZDUSD
- USDCAD
- USDJPY
- USDZAR
Noteworthy News
- Talk of the Fed last night is that we could possibly expect 3 rate hikes this year. If Trump gets his infrastructure budget passed, the spotlight will fall firmly on the dot path of the Fed.
Recap
President Trumps address to Congress was fairly predictable as he touched on immigration, the border wall with Mexico, and the repeal of Obamacare. He did touch on some market friendly points, which were:
- He wants an infrastructure program worth $ 1 trillion
- Cutting the corporate tax rates
- A massive tax relief to the middle class
Both the treasury yields and the USD soared on these points and continue to soar this morning, the equity markets are a little bit more subdued though. This could be because we are at record highs, but my opinion is that yet again Trump gave no detail on how he is going to achieve these ambitious policies. Until now the market has given Trump the benefit of the doubt, but unless he comes out of this “wishy washy” phase and starts giving details – the market will become unforgiving.
The dollar has gained across the board since the speech, in truth it is has done a lot of work and I am sure that the market will be due a retracement. I am going to err on the side of caution this morning and trade off the longer time frames, after comments out of the Fed yesterday, some are pricing in an 80% probability of a US rate hike in December. This means that London could move this dollar higher still, it seems the perfect time to use last week’s webinar on Fibonacci to our trading strategy.
Daily Ranges 01/03/2017
Majors
EURUSD
Resistance 1.0600 – 1.0620
Support 1.0540 – 1.0510
GBPUSD
Resistance 1.2440 – 1.2460
Support 1.2350 – 1.2310
AUDUSD
Resistance 0.7690 – 0.7700
Support 0.7650 – 0.7620
NZDUSD
Resistance 0.7190 – 0.7210
Support 0.7130 – 0.7100
USDCAD
Resistance 1.3330 – 1.3360
Support 1.3190 – 1.3160
USDJPY
Resistance 113.60 – 113.90
Support 112.50 – 112.00
USDCHF
Resistance 1.0090 – 1.0100
Support 1.0050 – 1.0030
Rand
USDZAR
Resistance 13.1525 – 13.1930
Support 12.9920 – 12.9650
EURZAR
Resistance 13.8700 – 13.9020
Support 13.7455 – 13.7020
GBPZAR
Resistance 16.1950 – 16.2370
Support 16.0950 – 16.0760
Minors
AUDCAD
Resistance 1.0200 – 1.0230
Support 1.0130 – 1.0110
AUDJPY
Resistance 87.10 – 87.40
Support 86.20 – 86.00
EURCHF
Resistance 1.0670 – 1.0690
Support 1.0630 – 1.0610
EURGBP
Resistance 0.8530 – 0.8560
Support 0.8465 – 0.8450
EURJPY
Resistance 119.90 – 120.30
Support 118.70 – 118.50
GBPJPY
Resistance 140.30 – 140.50
Support 139.30 – 139.10
GBPCAD
Resistance 1.6460 – 1.6490
Support 1.6350 – 1.6330
GBPCHF
Resistance 1.2525 – 1.2550
Support 1.2450 – 1.2420
Indices
DE30
Resistance 11880 – 11910
Support 11780 – 11750
UK100
Resistance 7270 – 7300
Support 7240 – 7220
US500
Resistance 2360 – 2390
Support 2340 – 2320
US30
Resistance 20800 – 20850
Support 20700 – 20650
SA40
Resistance 45100 – 45300
Support 44000 – 43700
Commodities
BRENT
Resistance 56.70 – 57.00
Support 55.90 – 55.50
XAUUSD
Resistance 1250.00 – 1270.00
Support 1235.00 – 1225.00
XAGUSD
Resistance 18.30 – 18.50
Support 18.10 – 18.00
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