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Dean's Daily FX Update – 12 May 2017
In the Zone
- EURUSD
- AUDUSD
- NZDUSD
- USDCAD
- USDJPY
Noteworthy News
- The employment report last week has left the CPI reading today surprisingly important. The Fed need to see inflation and earnings move in the same direction if we are to see another hike this year. If the CPI disappoints today – the dollar will come under immense pressure.
Recap
It is becoming increasingly difficult to read Donald Trump, and becoming ever more difficult to read the US public on his decision making. It is often a case of “one step forward and two steps back,” with him and I am wondering how long it will be before his supporters start asking questions – he seems to be all over the place. After the rhetoric that he shared during his campaign, he seems to be back tracking on all of them – this morning news has broken that the US and China have entered a trade deal which includes protein and financial services. Although great news for global trade, I am not sure how riling up your closest neighbours (Canada) and striking deals with your supposed enemy (China) is going to encourage your supporters that you can deliver on promises.
As a result the dollar continues to be a mixed bag against all the major pairs, economic data is becoming more important to watch, and the CPI and retail sales have taken a little more significance today as the market looks to sift through evidence that points to a stronger Q2.
The EURUSD tested the 200 day MA yesterday at 1.0835 and immediately found some support at this level. It did finish the day languishing somewhat in the middle of its range, I am looking for the pair to retest the pivotal 1.0900 level again today, this is the 100 hour MA and from here we will be able to better determine the next move – I am hoping for a fail at that level and then for the gap to close.
It was all about the BOE statement for cable, the message was a little mixed and in my opinion has left the bears with the initiative. Today will be all about whether the bears can hold onto that initiative, the 100 hour MA is trading at 1.2885, if price is able to hold onto those levels then it will launch again at 1.2900 – this level is pivotal and a close above this level would take some of initiative back for the bulls.
The USDCAD continues to be an incredibly frustrating pair to trade, there is equal reasons to wait for a set up and to walk away from the trade – I have still not decided what to do here. The pair continues to trade in the middle of its weekly range as buyers and sellers are battling for direction, the rating cuts on banks should have seen the pair weaken – but a stronger oil price has meant the damage is limited. The 100 and 200 hour MA trade at 1.3694 and 1.3705 respectively and it seems as though the USDCAD is bouncing off these levels. These levels are defining levels in this pair and we need to see a clear break of this range.
Daily Ranges 12/05/2017
Majors
EURUSD
Resistance 1.0880 – 1.0900
Support 1.0850 – 1.0820
GBPUSD
Resistance 1.2920 – 1.2930
Support 1.2870 – 1.2850
AUDUSD
Resistance 0.7380 – 0.7400
Support 0.7320 – 0.7300
NZDUSD
Resistance 0.6880 – 0.6900
Support 0.6830 – 0.6810
USDCAD
Resistance 1.3710 – 1.3730
Support 1.3660 – 1.3640
USDJPY
Resistance 114.20 – 114.30
Support 113.50 – 113.40
USDCHF
Resistance 1.0090 – 1.0100
Support 1.0050 – 1.0030
Rand
USDZAR
Resistance 13.4500 – 13.4800
Support 13.3050 – 13.3370
EURZAR
Resistance 14.6640 – 14.6940
Support 14.5040 – 14.4500
GBPZAR
Resistance 17.3700 – 17.4000
Support 17.2260 – 17.1850
Minors
AUDCAD
Resistance 1.0107 – 1.0120
Support 1.0060 – 1.0040
AUDJPY
Resistance 84.00 – 84.30
Support 83.50 – 83.30
EURCHF
Resistance 1.0960 – 1.0980
Support 1.0900 – 1.0870
EURGBP
Resistance 0.8430 – 0.8460
Support 0.8370 – 0.8350
EURJPY
Resistance 124.10 – 124.30
Support 123.50 – 123.30
GBPJPY
Resistance 147.10 – 147.30
Support 146.20 – 146.00
GBPCAD
Resistance 1.7710 – 1.7730
Support 1.7610 – 1.7580
GBPCHF
Resistance 1.3030 – 1.3050
Support 1.2970 – 1.2950
Indices
DE30
Resistance 12750 – 12770
Support 12650 – 12600
UK100
Resistance
Support
US500
Resistance 2400 – 2420
Support 2380 – 2370
US30
Resistance 20930 – 20950
Support 20870 – 20850
SA40
Resistance 48000 – 48100
Support 47400 – 47500
Commodities
BRENT
Resistance 51.20 – 51.50
Support 49.90 – 49.70
XAUUSD
Resistance 1220.00 – 1230.00
Support 1210.00 – 1200.00
XAGUSD
Resistance 16.50 – 16.70
Support 16.20 – 16.10
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