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It seems as though the equity traders finally realised what the rest of us were discussing months ago, whilst President Trump has promised market friendly regulations, we are still left how he is going to achieve it. All the US equity markets suffered their worst day of trading in 4 months as all US indices were down by over 1% last night. This move had a knock on effect as the greenback was sold off and investors moved into the relative safety of gold and US treasuries.
Dean's Daily FX Update – 22 March 2017
In the Zone
- EURUSD
- GBPUSD
- USDCHF
- USDJPY
- USDZAR
Noteworthy News
- Keep an eye on the US indices this week, it had a strong move and we could be in store for a deep correction. We lost over 1% last night, but Fibonacci Retracement is showing a possible 5% – 7% correction.
Recap
The GBPUSD was pushed another leg higher today as higher inflation weighs on the pair. The combination of the inflation report as well as last week’s surprising hawkish stand has meant that cable traders are for now ignoring the imminent trigger of Article 50. From a technical level, I would be watching 1.2500 for now, but I am still cautious leading into next week and prefer to sit this pair out.
The USDJPY often trades with a strong correlation with both the US Treasuries and Indices, and today was the perfect case in point. It was clear in early trading in New York that equity traders had had enough and the sellers started taking control. The USDJPY followed suit and the JPY moved toward the lows in all its corresponding pairs, we discussed the 111.50 level as it has confluence in that it finds both major support and a 38.2% fib and so I will be watching this level for a bounce today.
The USDCAD was choppy, it was keen to take advantage of both strong economic data and the weak dollar and broke below major support to trade at 1.3260. Oil however was unable to take advantage of the weak dollar and this was the catalyst for the CAD to move back above its 100 day MA and trade at 1.3340, until oil can find some decent support, the CAD is going to come under pressure.
The AUDUSD continues to find resistance at 0.7730 level, it broke through support at 0.7700 and that level could become a new resistance level this morning. I will be looking for 0.7650 – 0.7625 for initial support. We have event risk in the NZDUSD in the form of an interest rate decision in New Zealand, the consensus is for the rates to be kept on hold, and the key levels for me are 0.7100 this evening.
Most pairs in my zone this morning are the fundamental trade pairs and so I trade with caution today.
Daily Ranges 22/03/2017
Majors
EURUSD
Resistance 1.0810 – 1.0830
Support 1.0740 – 1.0720
GBPUSD
Resistance 1.2470 – 1.2495
Support 1.2390 – 1.2370
AUDUSD
Resistance 0.7720 – 0.7740
Support 0.7660 – 0.7640
NZDUSD
Resistance 0.7050 – 0.7070
Support 0.7015 – 0.7000
USDCAD
Resistance 1.3370 – 1.3390
Support 1.3300 – 1.3280
USDJPY
Resistance 112.40 – 112.70
Support 111.60 – 111.20
USDCHF
Resistance 0.9960 – 0.9990
Support 0.9930 – 0.9910
Rand
USDZAR
Resistance 12.7150 – 12.7450
Support 12.6020 – 12.5670
EURZAR
Resistance 13.6850 – 13.7250
Support 13.5590 – 13.5220
GBPZAR
Resistance 15.8340 – 15.8680
Support 15.6620 – 15.6290
Minors
AUDCAD
Resistance 1.0300 – 1.0320
Support 1.0250 – 1.0220
AUDJPY
Resistance 86.50 – 86.70
Support 85.50 – 85.20
EURCHF
Resistance 1.0750 – 1.0780
Support 1.0700 – 1.0680
EURGBP
Resistance 0.8690 – 0.8710
Support 0.8650 – 0.8630
EURJPY
Resistance 121.30 – 121.50
Support 120.50 – 120.20
GBPJPY
Resistance 139.70 – 139.90
Support 139.00 – 138.80
GBPCAD
Resistance 1.6680 – 1.6700
Support 1.6530 – 1.6500
GBPCHF
Resistance 1.2390 – 1.2420
Support 1.2350 – 1.2320
Indices
DE30
Resistance 12000 – 12050
Support 11800 – 11700
UK100
Resistance 7380 – 7400
Support 7310 – 7280
US500
Resistance 2360 – 2380
Support 2330 – 2310
US30
Resistance 20850 – 20900
Support 20600 – 20530
SA40
Resistance 44800 – 45000
Support 44100 – 43800
Commodities
BRENT
Resistance 51.70 – 51.90
Support 50.50 – 50.20
XAUUSD
Resistance 1244.00 – 1260.00
Support 1220.00 – 1200.00
XAGUSD
Resistance 17.50 – 17.70
Support 17.20 – 17.00
Important Economic Data out today
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