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Predictably, yesterday morning both the dollar and risk assets such as the AUD spent the day on the back foot. By time the New York session opened, it was plain to see that US traders had drawn a line in the sand and the dollar reversed a lot of those early losses with a solid bounce.
Dean's Daily FX Update – 28 March 2017
In the Zone
- EURUSD
- GBPUSD
- USDJPY
- USDCHF
- USDZAR
Noteworthy News
- The Trump administration is targeting an August release of the tax reform, considering the debacle last week, the Republicans will want to get a really strong piece of legislation passed.
Recap
The forex market continues to be dominated by political events and a large part of the dollar recovery yesterday was on the back of rumours that President Trump will make another attempt at the Healthcare Act, this time involving Democrats. At the same time, the Republicans would have started feeling a little bit of pressure, and so tax reform could be their trump card – excuse the pun.
The EURUSD took full advantage but found some resistance at 1.0915, this has confluence in that this is where the 200 Day MA level is currently trading. Likewise, the GBPUSD is trading in a similar trend. Cable recovered its March losses yesterday as it traded as high as 1.2620 before it found some sharp resistance, like the EUR it found resistance at its 200 Day MA level. I continue to sit both these pairs out on the fundamental risk posed tomorrow.
Despite the weaker dollar yesterday morning, the commodity currencies struggled to take advantage. USDCAD continues to be hampered by a less than impressive oil price. The CAD also has event risk in the form of central bank speeches this afternoon. The AUDUSD was the real loser yesterday, the AUD is seen as a proxy for risk and when traders start selling risk, the AUDUSD usually takes a clobbering.
We also saw the political rumours come out of South Africa yesterday, just when we thought the country had weathered the storm, we get reminded at how vulnerable the ZAR is. It did enable the pair to trade within the channel that we plotted last week, I would expect for this pair to have some form of retracement today, the outlook for the ZAR is bleak if these rumours are true.
Daily Ranges 28/03/2017
Majors
EURUSD
Resistance 1.0880 – 1.0900
Support 1.0820 – 1.0800
GBPUSD
Resistance 1.2570 – 1.2600
Support 1.2510 – 1.2480
AUDUSD
Resistance 0.7620 – 0.7640
Support 0.7610 – 0.7590
NZDUSD
Resistance 0.7060 – 0.7080
Support 0.7025 – 0.7010
USDCAD
Resistance 1.3380 – 1.3400
Support 1.3330 – 1.3300
USDJPY
Resistance 110.90 – 111.10
Support 110.20 – 110.00
USDCHF
Resistance 0.9880 – 0.9900
Support 0.9800 – 0.9780
Rand
USDZAR
Resistance 12.8390 – 12.8850
Support 12.5140 – 12.4960
EURZAR
Resistance 13.9295 – 13.9750
Support 13.5790 – 13.5300
GBPZAR
Resistance 16.1050 – 16.1800
Support 15.7630 – 15.7200
Minors
AUDCAD
Resistance 1.0205 – 1.0220
Support 1.0170 – 1.0140
AUDJPY
Resistance 84.60 – 84.80
Support 84.10 – 84.00
EURCHF
Resistance 1.0720 – 1.0740
Support 1.0700 – 1.0680
EURGBP
Resistance 0.8650 – 0.8670
Support 0.8610 – 0.8600
EURJPY
Resistance 120.40 – 120.60
Support 119.80 – 119.50
GBPJPY
Resistance 139.00 – 139.20
Support 138.20 – 138.00
GBPCAD
Resistance 1.6790 – 1.6820
Support 1.6700 – 1.6680
GBPCHF
Resistance 1.2390 – 1.2410
Support 1.2350 – 1.2320
Indices
DE30
Resistance 12060 – 12080
Support 11970 – 11930
UK100
Resistance 7330 – 7340
Support 7280 – 7250
US500
Resistance 2340 – 2360
Support 2320 – 2300
US30
Resistance 20600 – 20650
Support 20500 – 20470
SA40
Resistance 45550 – 45700
Support 45000 – 44800
Commodities
BRENT
Resistance 51.00 – 51.20
Support 50.20 – 50.00
XAUUSD
Resistance 1260.00 – 1275.00
Support 1240.00 – 1220.00
XAGUSD
Resistance 18.00 – 18.20
Support 17.70 – 17.50
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