Forex Market Preview

Dean Forex Market Commentary – 13 December 2016

Forex traders seem to be positioning themselves for the FOMC meeting tomorrow. There are still opportunities to scalp a few pips and most seem to be in the commodity currencies. There are also possibilities in the Yen after such a weak performance against the dollar.

Dean's Daily FX Update – 13 December 2016

 

In the Zone

  • AUDUSD
  • NZDUSD
  • USDCAD
  • USDJPY

Noteworthy News

  • Somebody in the White House is going to have to confiscate Donald Trump’s phone, he continues to make potential market moving statements over twitter. This has the potential to create massive market volatility over the next 4 years.

Recap

The market is clearly in no mood to let prices get away ahead of the FOMC tomorrow evening and there seemed to be a lot of “mock trading” last night. I did confirm that I am not in the market ahead of this meeting this week but if I was I would be looking for shorter term trades and possibly taking profit early.

The dollar did retreat a little yesterday ahead of the market, but prices have essentially been moved back to where they were in the Asia Pacific Session this morning. Although the Dow closed higher yet again, it is slowing momentum and the S&P 500 closed lower today. I will reiterate today that I will not trade the equities at all, prices seem inflated to me and is in need of some deflation – the real question though ahead of the inauguration of a market friendly Trump, how deep will that deflation be?

We discussed the formation of a triple bottom in the EURUSD over the weekend, and that it represented a sign to bounce. We traded to 1.0520 yesterday morning and the pair found a foothold and traded as high as 1.0650. This is a major resistance level as price moves towards both the 100 and 200 hour MA and 38.2% Fib level. I would be watching to see if we have some selling pressure at those levels and the key area today will be 1.0630, if we trade lower the EUR could be testing 1.0600 fairly quickly.

GBPUSD was in a bullish mood yesterday as the market changed polarity – sellers turned to buyers at the 1.2600 level. The price managed to move towards 1.2700 on the day but found some staunch resistance before it retraced to 1.2665 last night, cable seems nicely poised this morning at these levels although the buyers may have a slight edge – that being said, it will need to break 1.2700 to make a meaningful move. A break above 1.2700 and we target 1.2770 which was our big level last week and is also the 100 day MA, I would expect sellers to come into the market there, if we break below 1.2630 then 1.2600 comes back into play.

The USDCAD is another pair that threatened a “mock charge” yesterday, just as we thought that this pair would march higher it was contained at around 1.3150. Oil did find some support late in the US session last night and the CAD followed suit, as I highlighted in this morning’s video I do think that oil could give back further some of its gains, and will then lead the USDCAD higher today. It has formed a base at 1.3120 yesterday and it needs to break 1.3150 to extend further and possibly trade to 1.3200.

The AUDUSD and NZDUSD are still being defined to tight trading ranges and will have to break these parameters, ahead of the FOMC these ranges may hold – I cover both pairs in the morning video.

Daily Ranges 13/12/2016

Majors

EURUSD

Resistance                                          1.0630 – 1.0650

Support                                                1.0557 – 1.0550

GBPUSD

Resistance                                          1.2670 – 1.2700

Support                                                1.2620 – 1.2598

AUDUSD

Resistance                                          0.7494 – 0.7500

Support                                                0.7460 – 0.7440

NZDUSD

Resistance                                          0.7188 – 0.7200

Support                                                0.7145 – 0.7130

USDCAD

Resistance                                          1.3160 – 1.3190

Support                                                1.3120 – 1.3100

USDJPY

Resistance                                          115.68 – 115.90

Support                                                114.77 – 114.48

USDCHF

Resistance                                          1.0175 – 1.0187

Support                                                1.0138 – 1.0118

Rand

USDZAR

Resistance                                          13.7740 – 13.8200

Support                                                13.6000 – 13.5350

EURZAR

Resistance                                          14.5750 – 14.6162

Support                                                14.4475 – 14.3810

GBPZAR

Resistance                                          17.4108 – 17.4805

Support                                                17.1902 – 17.1045

Minors

AUDCAD

Resistance                                          0.9834 – 0.9848

Support                                                0.9780 – 0.9750

AUDJPY

Resistance                                          86.40 – 86.52

Support                                                85.81 – 85.44

EURCHF

Resistance                                          1.0770 – 1.0792

Support                                                1.0745 – 1.0720

EURGBP

Resistance                                          0.8410 – 0.8430

Support                                                0.8364 – 0.8340

EURJPY

Resistance                                          122.62 – 122.91

Support                                                121.70 – 121.56

GBPJPY

Resistance                                          146.14 – 146.60

Support                                                145.00 – 144.90

GBPCAD

Resistance                                          1.6640 – 1.6650

Support                                                1.6533 – 1.6504

GBPCHF

Resistance                                          1.2863 – 1.2878

Support                                                1.2800 – 1.2780

CADCHF

Resistance                                          0.7762 – 0.7781

Support                                                0.7710 – 0.7682

Indices

DE30

Resistance                                          11214 – 11260

Support                                                11115 – 11050

UK100

Resistance                                          6940 – 6960

Support                                                6880 – 6850

US500

Resistance                                          2260 – 2275

Support                                                2245 – 2225

US30

Resistance                                          19800 – 19900

Support                                                19600 – 19500

SA40

Resistance                                          44086 – 44200

Support                                                43200 – 43000

Commodities

BRENT

Resistance                                          56.35 – 56.70

Support                                                54.60 – 54.30

XAUUSD

Resistance                                          1170.00 – 1173.20

Support                                                1158.74 – 1154.00

XAGUSD

Resistance                                          17.19 – 17.30

Support                                                16.84 – 16.73

Important Economic Data out today

  • 11:30                     GBP                       CPI

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