(Ranges are calculated using recent high and lows and technical analysis - Fibonacci levels, trendlines and moving averages.)
USD/JPY-to trade in higher range. Underpinned by reduced safe-haven appeal of yen and yen-funded carry trades as global risk sentiment improves (VIX fear gauge eased 2.9% to 13.4) and U.S. stocks ended mostly higher overnight (S&P 500 rose 0.56%, DJIA gained 0.72%, Nasdaq slipped 0.32%) after Federal Reserve Chairwoman Janet Yellen gave a relatively upbeat outlook for the U.S. economy, but said her optimism hadn't changed the Fed's plans to keep short-term interest rates near zero for the foreseeable future; while worries over Ukraine eased after Russia's president Vladimir Putin said he was ready to discuss a way out of the crisis. USD/JPY also supported by improved dollar sentiment (ICE spot dollar index last 79.23 versus 79.14 early Wednesday); demand from Japan importers. But USD/JPY gains tempered by lower U.S. Treasury yields after Yellen's dovish comments; Japan exporter sales. Yen crosses vulnerable to China April trade balance data (exports likely declined by 3.5% on-year, imports likely fell 3.2% on-year, trade surplus likely widened to $17.3 billion from $7.71 billion). Other data & event focus: 1230 GMT U.S. jobless claims in week ended May 3; 1330 GMT Yellen testifies to U.S. Senate committee on the economic and fiscal outlook. Daily chart still negative-biased as MACD & stochastics in bearish mode. Resistance at 102.01 (Wednesday's high), then at 102.19-102.26 band (Tuesday's high-Monday's high); breach would expose upside to 103.02-103.11 band (Friday's high-April 8 high), then 103.43 (April 7 high), 104.13 (April 4 high) and 104.84-104.92 band (Jan. 23 high-Jan. 16 high). Support at 101.43-101.42 (Wednesday's low-April 14 low); breach would target 101.32 (April 11 reaction low), then 101.15 (March 17 reaction low), 101.06 (200-day moving average), 100.76 (Feb. 4 swing low) and psychological 100.00 line.
EUR/USD--to consolidate in lower range as markets await 1145 GMT European Central Bank interest rate announcement: ECB is expected to keep monetary policy unchanged. EUR/USD undermined by improved dollar sentiment; surprise 2.8% on-month drop in Germany March manufacturing orders (versus forecast for 0.2% increase). But euro sentiment soothed by rise in Markit euro-zone retail PMI to 36-month high of 51.2 in April from 49.2 in March. EUR/USD losses also tempered by improved investor risk appetite. Other data: 0600 GMT Germany March industrial production index. Daily chart mixed as MACD bullish, five-day moving average above 15-day MA and advancing; but stochastics turned bearish at overbought. Support at 1.3910 (Wednesday's low), then at 1.3873-1.3865 band (Tuesday's low-Monday's low); breach would expose downside to 1.3812 (Friday's low), then 1.3771 (April 30 low), 1.3738 (April 8 low), 1.3680-1.3672 band (April 7 low-April 4 low) and 1.3643 (Feb. 27 reaction low). Resistance at 1.3939 (Wednesday's high), then at 1.3952 (Tuesday's high); breach would target 1.3967 (March 13 top), then psychological 1.4000 line and 1.4248 (Oct. 27, 2011 reaction high).
AUD/USD--to trade in lower range. Spotlight on 0130 GMT Australia April labour force data. AUD/USD undermined by improved dollar sentiment; weaker-than-expected Australia March retail sales data. But AUD/USD losses tempered by Aussie demand on buoyant AUD/NZD cross; improved investor risk appetite. Aussie vulnerable to China April trade balance data. Daily chart mixed as MACD bearish; but stochastics in bullish mode, five-day moving average rising above 15-day MA, inside-day-range pattern completed Wednesday. Support at 0.9316 (Wednesday's low); breach would expose downside to 0.9265 (Tuesday's low), then 0.9250 (Monday's low), 0.9200 (Friday's low) and 0.9188 (55-day moving average). Resistance at 0.9354 (Wednesday's high), then at 0.9367-0.9377 band (Tuesday's high-April 22 high); breach would target 0.9390 (April 17 high), then 0.9426 (April 11 high) and 0.9461 (five-month high hit April 10).
NZD/USD--to trade with bearish bias. Undermined by improved dollar sentiment; comment from RBNZ Gov. Wheeler that a high Kiwi exchange rate in face of weakening fundamentals may prompt RBNZ to intervene to sell NZD; lower dairy product prices; Kiwi sales on buoyant AUD/NZD cross; concerns over China's economy. But NZD/USD losses tempered by improved investor risk appetite; NZD-USD interest differential. Data focus: 0000 GMT New Zealand April QV nationwide residential property values. Daily chart mixed as MACD bullish, but stochastics turned bearish at overbought. Support at 0.8615 (61.8% Fibonacci correction of 0.8514-0.8779 April 29-May 6 advance); breach would target 0.8591 (Friday's low), then 0.8555 (55-day moving average), 0.8539 (April 30 low), 0.8514-0.8511 (April 29 low-April 3 low) and 0.8499 (March 20 low). Resistance at 0.8779 (Tuesday's two-and-a-half year high); breach would expose upside to 0.8840 (Aug. 1, 2011 swing high), then the psychological 0.9000 line.
GBP/USD--to consolidate in lower range as markets await 1100 GMT Bank of England interest rate announcement: BOE is expected to leave its benchmark interest rate at 0.5% and the overall size of its bond portfolio at Ј375 billion. GBP/USD undermined by improved dollar sentiment. But GBP/USD losses tempered by positive investor risk tolerance. Daily chart still positive-biased as MACD bullish, stochastics stays elevated at overbought; five- & 15-day moving averages advancing. Support at 1.6949 (Wednesday's low); breach would expose downside to 1.6862-1.6852 band (Tuesday's low-Monday's low), then 1.6820 (Friday's low), 1.6804 (April 30 low), 1.6791 (April 29 low) and 1.6775 (April 28 low). Resistance at 1.6986 (Wednesday's high), then at 1.6996-1.7000 (Tuesday's four-and-a-half year high - psychological line); breach would target 1.7042 (Aug. 5, 2009 reaction high), then 1.7330 (50% Fibonacci retracement of decline from Nov. 9, 2007 high of 2.1161 to Jan. 23, 2009 low of 1.3498).
USD/CHF--to trade in higher range. Underpinned by improved dollar sentiment; franc sales on buoyant EUR/CHF cross. But CHF sentiment boosted by drop in Switzerland jobless rate to 3.2% in April from 3.3% in March. Data focus: 0545 GMT Switzerland April quarterly consumer sentiment index, 0715 GMT Switzerland April CPI. Daily chart mixed as MACD bearish, five-day moving average below 15-day MA and declining; but stochastics turned bullish at oversold, inside-day-range pattern completed Wednesday. Resistance at 0.8764 (Wednesday's high), then at 0.8781 (Monday's high); breach would expose upside to 0.8841-0.8850 band (Friday's high-April 30 high), then 0.8861 (April 22 high), 0.8879 (April 8 high) and 0.8927 (April 7 high). Support at 0.8730 (Wednesday's low), then at 0.8718 (Tuesday's low); breach would target 0.8696 (March 13 low), then 0.8566 (Oct. 27, 2011, reaction low) and 0.8520 (50% Fibonacci retracement of advance from Aug. 9, 2011 low of 0.7068 to July 24, 2012 high of 0.9972).
USD/CAD--to trade in higher range. CAD sentiment dented by surprise 3% drop in Canada March building permits (versus forecast for 4% increase). USD/CAD also supported by improved dollar sentiment. But USD/CAD gains tempered by improved investor risk appetite; firmer oil prices (Nymex crude settled $1.27 higher Wednesday at $100.77/bbl). Data focus: 1215 GMT Canada April housing starts, 1230 GMT Canada March new-housing price index. Daily chart still negative-biased as MACD & stochastics bearish, five-day moving average below 15-day MA and declining; although inside-day-range pattern completed Wednesday. Resistance at 1.0907 (Wednesday's high); breach would expose upside to 1.0960 (Tuesday's high), then 1.0988 (Monday's high), 1.1004 (Friday's high), 1.1029-1.1039 band (April 29 high-April 28 high, near 55-day moving average) and 1.1047-1.1053 band (April 25 high-April 23 high). Support at 1.0873-1.0870 (Wednesday's low-Tuesday's low); breach would target 1.0853 (April 9 reaction low), then 1.0707 (200-day moving average).
EUR/JPY--to trade with risks skewed higher. Supported by improved investor risk appetite; demand from Japan importers. But EUR/JPY gains tempered by Japan exporter sales. Daily chart mixed as MACD bullish, but stochastics in bearish mode, five- & 15-day moving averages meandering sideways. Resistance at 141.99 (Wednesday's high), then at 142.10 (Tuesday's high); breach would expose upside to 142.47 (April 29 high), then 142.61 (April 4 high) and 143.44-143.47 (April 3 high-April 2 high). Support at 141.15-141.13 (Wednesday's low-April 30 low); breach would target 140.99 (April 28 low), then 140.68 (April 16 low), 140.24 (April 15 low) and 140.08 (April 8 low).
EUR/GBP--to consolidate after hitting two-month low 0.8184 Wednesday as markets await BOE and ECB's interest rate decisions. Daily chart still negative-biased as stochastics bearish, five- & 15-day moving averages declining. Support at 0.8184-0.8182 (Wednesday's low-Feb. 28 reaction low); breach would target 0.8154 (Feb. 17 swing low), then 0.8101 (Jan. 7, 2013 low) and 0.8083 (Jan. 3, 2013 reaction low). Resistance at 0.8213 (Wednesday's high), then at 0.8232-0.8237 (Monday's high-April 30 high); breach would target 0.8258-0.8268 band (April 29 high-April 16 high), then 0.8284 (April 14 high), 0.8310-0.8314 (April 11 high-April 3 high) and 0.8365 (March 26 high).
Write to Jerry Tan at jerry.tan@wsj.com
(MORE TO FOLLOW) Dow Jones Newswires
May 07, 2014 19:22 ET (23:22 GMT)
0 Response to "Yen Soft As Yellen's Comments Boost Risk Sentiment - ASIA DAILY FOREX OUTLOOK"
Thanks for give comment.