(Ranges are calculated using recent highs and lows, information on the placement of option strikes, and technical analysis--Bollinger Bands, Fibonacci levels, trendlines and moving averages.)
USD/CNY--consolidation. Spot USD/CNY is likely to linger between the daily Bollinger bands (standard deviation 1) forming a range of 6.1140-6.1243. The pair appears to lack momentum unless it breaks this consolidation zone and enters the uptrend or downtrend Bollinger channels. The continued rise of USD/JPY could increase chances that the daily USD/CNY benchmark rate may be moved upwards slightly. Focus is on the HSBC China flash manufacturing PMI for November; the final reading for October was 50.4 which was a small increase from the previous month's 50.2. Dow Jones technical analysis suggests immediate support for spot USD/CNY is at 6.1191 (20-day Bollinger mid support), then at 6.1140 (daily Bollinger downtrend channel), before 6.1088 (base of daily Bollinger downtrend channel). Immediate resistance is at 6.1243 (daily Bollinger uptrend channel), then at 6.1294 (top of daily Bollinger uptrend channel), before 6.1401 (daily Ichimoku Cloud resistance zone).
USD/TWD--uptrend. The slope of USD/TWD's ascent has steepened following a sharp rally Wednesday - suspected partly fuelled by the central bank which traders say bought U.S. dollars at a higher level than the previous day. USD/TWD is fast closing in on the round-figure trading barrier at 31.000. A break of this psychological barrier could trigger short-covering that would boost the greenback sharply. The central bank was suspected of buying U.S. dollars at 30.810 Wednesday, whereas they were sighted at 30.715 on Tuesday. The central bank may be whittling its currency to help exporters as currencies of regional export rivals weaken significantly. The price of the 1-month USD/TWD nondeliverable forward contract in the offshore market is now above that of the spot contract, suggesting that speculative demand for the dollar has increased. Dow Jones technical analysis suggests immediate support is at 30.720 (base of daily Bollinger uptrend channel), then at 30.560 (20-day Bollinger mid support), before 30.500 (psychological support). Immediate resistance is likely at 31.000 (round-figure trading barrier), before 31.200 (psychological resistance).
USD/KRW--uptrend. USD/KRW opens sharply higher at 1,115.0 versus its Wednesday close of 1,106.3 in reaction to the overnight jump in USD/JPY past 118.00. The South Korea won is under increasing pressure as the stage appears set for more yen weakness. Japan's December snap election is expected to foment support for Prime Minister Shinzo Abe's pro-inflation policies. As USD/JPY continues to rise past levels last seen in 2007, proxy currency pairs such as USD/KRW have been rising in tandem. The bullish technical bias for USD/KRW has strengthened after last week's closing above the 200-week moving average at 1,095 - a medium term technical indicator. Dow Jones technical analysis suggests immediate support is at 1,110 (round-figure trading barrier), then at 1,107 (base of monthly Bollinger uptrend channel), before 1,100 (round-figure trading barrier). Immediate resistance is 1,117 (top of daily Bollinger uptrend channel), then at 1,120 (round-figure trading barrier).
USD/SGD--uptrend. USD/SGD is likely to keeping rising now that it has surged past the round-figure trading barrier of 1.3000 - a level not seen since January 2012. The Singapore dollar is thus at its weakest versus the U.S. unit in almost 3 years. The daily and weekly USD/SGD chart suggests more upside is available if the respective Bollinger uptrend channels are kept in play. Continued bullishness for USD/JPY remains the key factor propelling USD/SGD higher. The Japanese yen is a beacon for the Singapore dollar because it is a constituent of the currency valuation model that the Monetary Authority of Singapore uses to determine fair value for its currency. Dow Jones technical analysis shows immediate support is at 1.3000 (round-figure trading barrier), then at 1.2982 (base of daily Bollinger uptrend channel), before 1.2950 (psychological support). Immediate resistance is at 1.3077 (top of daily Bollinger uptrend channel), then at 1.3100 (round-figure trading barrier), before 1.3199 (3-year high).
USD/MYR--uptrend. USD/MYR may mark new multi-year highs as lead indicator USD/JPY continues its rampage, breaking another round-figure trading barrier at 118.00 in overnight trade. USD/MYR may keep climbing until the 3.3820 top of the daily Bollinger uptrend channel - an interim chart resistance level - is met. Japan's yen is expected to keep falling as snap elections in Japan will likely reaffirm the country's monetary easing policies. USD/MYR continues to show positive technical signs on the daily and weekly chart, and could soon also appear bullish on the monthly chart if it ends November above 3.3345 - the top of the monthly Ichimoku Cloud resistance zone. Dow Jones technical analysis suggests immediate support is at 3.3520 (base of daily Bollinger uptrend channel), then at 3.3345 (monthly Ichimoku Cloud support), before 3.3220 (20-day Bollinger mid support). Immediate resistance is at 3.3820 (top of daily Bollinger uptrend channel), before 3.4000 (round-figure trading barrier).
USD/THB--possible uptrend. USD/THB could re-enter the daily Bollinger uptrend channel on a Thursday close above 32.85. The rise of USD/JPY is slowly but surely luring USD/THB higher, even though its correlation with the yen is weaker than some other Asian currencies. The prolonged rally of regional USD/Asia pairs such as USD/MYR and USD/SGD is likely to start affecting USD/THB. On Wednesday, Thailand's industrial confidence index rose to 87.5 in October from 86.1 the previous month, ending two straight months of decline. But the upbeat reading was insufficient to boost the baht. In the medium term, the economic outlook may improve if the China rail-link deal - approved in principle by Thailand's military government - gets full passage. Dow Jones technical analysis suggests immediate support is at 32.69 (20-day Bollinger mid support), then at 32.54 (daily Bollinger downtrend channel), before 32.50 (psychological support). Immediate resistance is at 32.82 (October trendline), then at 32.85 (daily Bollinger uptrend channel), before 32.88 (top of monthly Ichimoku Cloud resistance zone).
USD/PHP--uptrend. A clearer direction for USD/PHP has emerged after Wednesday's break of the 45.00 round-figure trading barrier and strong closing inside the daily Bollinger uptrend channel. The bullish chart signal suggests USD/PHP may soon mark a new 8-month high - if it surpasses the 45.12 record set in early November. The next chart target for this pair is the top of the weekly Bollinger uptrend channel at 45.47. Volatility has recently been low for USD/PHP but the triggering of the Bollinger uptrend channel may increase speculative interest in this pair. Dow Jones technical analysis suggests immediate support is at 45.00 (round-figure trading barrier), then at 44.98 (base of daily Bollinger uptrend channel), before 44.90 (20-day Bollinger mid support). Immediate resistance is likely at then at 45.07 (top of daily Bollinger uptrend channel), then at 45.12 (8-month high), before 45.47 (top of weekly Bollinger uptrend channel).
USD/IDR--supported. USD/IDR appears to have formed a base around 12,110 as the daily Ichimoku Cloud support and the entrance to the Bollinger downtrend channel coincide to create a strong technical floor. The rupiah has struggled to rally despite economists and credit rating agencies lauding the central bank's preemptive move to raise interest rates right after fuel prices were increased. The overall rise of the U.S. dollar in Asia - mainly due to the Japanese yen falling sharply for a prolonged period - has hampered rupiah appreciation. The government's budget-friendly cutting of fuel subsidies and Bank Indonesia's anti-inflationary interest rate hike makes Indonesia appear more stable from a fiscal perspective, and therefore more attractive to foreign investors seeking high-yielding government bonds. Dow Jones technical analysis suggests immediate support for spot USD/IDR is at 12,110 (daily Bollinger downtrend channel and Ichimoku Cloud support), then at 12,040 (base of daily Bollinger downtrend channel), before 12,000 (round-figure trading barrier). Immediate resistance is at 12,190 (daily Bollinger uptrend channel), before 12,240 (top of daily Bollinger uptrend channel).
USD/INR--uptrend. USD/INR is starting to display more upward momentum after it broke October's 10-month peak of 61.94 on Wednesday. The dollar could today break the 62.00 round-figure trading barrier and in so doing, trigger stoploss orders to buy USD/INR. A stoploss-orders related spike could send USD/INR toward the top of the weekly Ichimoku Cloud resistance zone at 62.55. In the medium term, the rupee is still likely to fall versus the U.S. dollar due to inevitable U.S. interest rate hikes, but analysts expect it to stay strong versus other emerging market currencies due to positive fundamentals. Dow Jones technical analysis suggests immediate support is at 61.66 (base of daily Bollinger uptrend channel), then at 61.51 (September trendline support), before 61.46 (20-day Bollinger mid support). Immediate resistance is likely at 62.00 (round-figure trading barrier), then at 62.55 (top of weekly Ichimoku Cloud resistance zone).
(This article is general financial information, not personalized investment advice, as it does not consider the unique circumstances affecting an individual reader's decision to buy or sell a specific security. Dow Jones does not warrant the accuracy, completeness or timeliness of the information in this article, and any errors will not be made the basis for any claim against Dow Jones. The author does not invest in the instruments or markets cited in this article.)
(END) Dow Jones Newswires
November 19, 2014 20:16 ET (01:16 GMT)
Write to Ewen Chew at ewen.chew@wsj.com
(MORE TO FOLLOW) Dow Jones Newswires
November 19, 2014 20:16 ET (01:16 GMT)
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