(Ranges are calculated using recent high and lows and technical analysis - Fibonacci levels, trendlines and moving averages.)
USD/JPY--to consolidate with bullish bias as markets await Bank of Japan interest rate decision: BOJ is expected to stay pat on policy. USD/JPY supported by yen-funded carry trades amid positive risk sentiment (VIX fear gauge eased 13.53% to 16.81, S&P 500 closed up 2.4% at 2,061.23 overnight) as investors remained reassured by Federal Reserve's pledge on Wednesday to be "patient" on raising interest rates, while data out of Germany and the U.K. were upbeat. USD/JPY also supported by higher U.S. Treasury yields (10-year at 2.207% versus 2.135% late Wednesday; positive dollar sentiment (ICE spot dollar index last 89.21 versus 89.07 early Thursday) on fewer-than-expected 289,000 U.S. jobless claims in week ended December 13 (versus forecast 295,000); demand from Japan importers; Bank of Japan's large-scale monetary easing policy. But USD sentiment dented by drop in Markit U.S. December flash services PMI to 53.6 from 56.2 in November, fall in U.S. Philadelphia Fed business index to 24.5 in December from November's 40.8. USD/JPY gains also tempered by Japan exporter sales; positions adjustment before weekend. Data focus: 0430 GMT Japan October all industry index, 1500 GMT Fed's Charles Evans speaks, 1600 GMT U.S. December Kansas City's manufacturing activity index. Daily chart mixed as MACD bearish, but stochastics in bullish Mode. Resistance at 119.31 (Thursday's high); breach would target 119.55 (Dec. 11 high), then 119.92 (Dec. 10 high), 121.00 (Dec. 9 high) and 121.86 (seven-year high hit Dec. 8). Support at 118.26 (Thursday's low); breach would tilt near-term view negative, exposing downside to 116.30 (Wednesday's low), then 115.56 (Tuesday's low), 115.44 (Nov. 17 low), 114.88 (Nov. 12 low) and 113.99 (55-day moving average).
EUR/USD--to trade in lower range. Undermined by positive dollar sentiment; expectations that the ECB would embark on large-scale asset purchases centered on government bonds early next year; euro sales on soft EUR/GBP cross. But EUR sentiment soothed by rise in Germany Ifo business climate index to 105.5 in December from November's 104.7; 1.3% on-month increase in eurozone October construction output for fastest monthly rise since December 2013. EUR/USD losses also tempered by positive risk sentiment; positions adjustment before weekend. Data focus: 0700 GMT Germany January GfK consumer climate survey, 0700 GMT Germany November PPI, 0900 GMT eurozone October balance of payments. Daily chart negative-biased as stochastics in bearish mode; MACD turning bearish; five-day moving average falling below 15-day moving average. Support at 1.2265 (Thursday's low); breach would target 1.2247-1.2239 band (Dec. 8 low-Aug. 10, 2012 low), then 1.2132 (Aug. 2, 2012 low). Resistance at 1.2353 (Thursday's high); breach would temper negative near-term view, exposing upside to 1.2516 (Wednesday's high), then 1.2570-1.2575 (Tuesday's high-Nov. 20 high), 1.2599 (Nov. 19 reaction high) and 1.2770 (Oct. 29 reaction high).
AUD/USD--to consolidate. Undermined by positive dollar sentiment; soft commodity prices (CRB spot index closed down 0.85% Thursday at 237.86); recent jawboning against Aussie exchange rate from RBA officials; Aussie sales on soft AUD/NZD cross. But AUD/USD downside limited by Aussie demand on buoyant AUD/JPY cross amid positive risk sentiment; positions adjustment before weekend. Daily chart mixed as MACD bearish, five- and 15-day moving averages declining; but stochastics turned bullish at oversold levels, inside-day-range pattern completed Thursday. Resistance at 0.8203 (Thursday's high), then at 0.8235 (Wednesday's high, near 10-day exponential moving average); breach would target 0.8274 (Monday's high), then 0.8298 (Dec. 12 high), 0.8375 (Dec. 11 high), 0.8392 (Dec. 5 high), 0.8429 (Dec. 4 high) and 0.8466 (Dec. 3 high). Support at 0.8113-0.8104 band (Thursday's low-Wednesday's four-and-a-half year low); breach would target 0.8086 (June 8, 2010 reaction low), then 0.8065 (May 25, 2010 swing low), psychological 0.8000 line and 0.7700 (July 13, 2009 reaction low).
NZD/USD--to trade in higher range. Supported by Kiwi demand on buoyant NZD/JPY cross amid positive risk sentiment; Kiwi demand on soft AUD/NZD cross; NZD-USD interest differential. But NZD/USD gains tempered by positive dollar sentiment; positions adjustment before weekend. Data focus: 0000 GMT ANZ New Zealand December business outlook, 0200 GMT New Zealand November credit card statistics. Daily chart mixed as MACD and stochastics neutral. Resistance at 0.7802 (Wednesday's high), then at 0.7848 (Tuesday's high); breach would target 0.7870 (Dec. 11 high), then 0.7889 (Dec. 2 high), 0.7910 (Dec. 1 high) and 0.7926 (Nov. 27 high). Support at 0.7679 (Thursday's low); breach would target 0.7659 (Dec. 10 low), then 0.7606 (two-and-a-half year low hit Dec. 9), 0.7451 (June 1, 2012 swing low) and 0.7367 (Nov. 25, 2011 swing low).
GBP/USD--to trade in higher range. GBP sentiment boosted by stronger-than-expected 1.6% on-month and 6.4% on-year increase in U.K. November retail sales (versus forecast +0.4% on-month, +4.5% on-year). GBP/USD also supported by sterling demand on buoyant GBP/JPY cross amid positive risk sentiment; sterling demand on soft EUR/GBP cross. But GBP/USD gains tempered by positive dollar sentiment; positions adjustment before weekend. Data focus: 0005 GMT U.K. December consumer confidence survey, 0930 GMT U.K. November public sector net borrowing, 1100 GMT U.K. December CBI monthly distributive trades survey. Daily chart mixed as MACD bullish but stochastics in bearish mode, inside-day-range pattern completed Thursday. Resistance at 1.5677 (Thursday's high), then at 1.5756 (Wednesday's high); breach would target 1.5785 (Tuesday's high), then 1.5825 (Nov. 27 reaction high), 1.5857 (55-day moving average), 1.5944 (Nov. 11 reaction high) and 1.6021 (Nov. 5 high). Support at 1.5543-1.5539 (Wednesday's low-Dec. 8 low); breach would turn near-term view negative, targeting 1.5504 (Sept. 2, 2013 low), then 1.5426 (Aug. 28, 2013 reaction low) and 1.5205 (Aug. 7, 2013 low).
USD/CHF--to consolidate with bullish bias after hitting two-year high 0.9848 Thursday. CHF sentiment hurt after Switzerland's central bank said Thursday it would charge a negative interest rate of 0.25% on deposits from Jan. 22 to cool the strength of the Swiss franc. USD/CHF also supported by positive dollar sentiment; franc sales on cross trades versus major currencies. But USD/CHF gains tempered by positions adjustment before weekend. Daily chart positive-biased as stochastics in bullish mode; MACD turning bullish; five- and 15-day moving averages advancing. Resistance at 0.9848 (Thursday's high); breach would expose upside to 0.9972 (July 24, 2012 swing high), then psychological 1.0000 line and 1.0066 (Dec. 1, 2010 reaction high). Support at 0.9756 (hourly chart), then at 0.9719 (Thursday's low); breach would expose downside to 0.9592 (Wednesday's low), then 0.9552 (Tuesday's low), 0.9530 (Nov. 19 reaction low), 0.9439 (Oct. 29 reaction low, near 100-day moving average) and 0.9395 (Oct. 21 low).
USD/CAD--to consolidate. Undermined by loonie demand on buoyant CAD/JPY cross amid positive risk sentiment. But USD/CAD downside limited by positive dollar sentiment; weak oil prices (Nymex crude settled down $2.36 at $54.11/bbl Thursday); positions adjustment before weekend. Data focus: 1330 GMT Canada October retail sales, November CPI. Daily chart mixed as MACD bullish, but stochastics turned bearish at overbought levels. Support at 1.1565-1.1557 band (Thursday's low-Wednesday's low), then at 1.1545 (Monday's low); breach would target 1.1512 (Dec. 12 low), then 1.1449 (Dec. 11 low), 1.1430 (Dec. 10 low), 1.1394 (Dec. 9 low) and 1.1374 (Dec. 5 low). Resistance at 1.1647 (Thursday's high), then at 1.1673 (Wednesday's five-year high); breach would expose upside to 1.1724 (July 8, 2009 reaction high), then 1.1814 (May 18, 2009 high).
EUR/JPY--to consolidate. Supported by positive risk sentiment; demand from Japan importers. But EUR/JPY gains upside limited by Japan exporter sales; soft EUR/USD undertone; positions adjustment before weekend. Daily chart mixed as MACD bearish, five-day moving average below 15-day moving average and declining; but stochastics turning bullish at oversold levels, inside-day-range pattern completed Thursday. Resistance at 146.72-146.74 (Thursday's high-Wednesday's high), then at 147.02 (Tuesday's high); breach would expose upside to 148.45 (Monday's high), then 148.86 (Dec. 9 high), 149.79 (Dec. 8 six-year high) and psychological 150.00 line. Support at 145.61 (Thursday's low), then at 145.36 (Wednesday's low); breach would target 144.96 (Tuesday's low), then 144.75 (Nov. 17 low), 144.27 (Nov. 14 low), 143.19 (Nov. 12 low) and 142.73 (55-day moving average).
(MORE TO FOLLOW) Dow Jones Newswires
EUR/GBP--to trade in lower range. Undermined by stronger-than-expected U.K. November retail sales. Daily chart negative-biased as stochastics in bearish mode; MACD turned bearish; five-day moving average turning downward alongside declining 15-day moving average. Support at 0.7833-0.7828 band (Thursday's low-Dec. 3 low); breach would target 0.7794 (Nov. 12 low), then 0.7781 (Oct. 2 low) and 0.7758-0.7753 (Sept. 30 reaction low-July 23, 2012 swing low). Resistance at 0.7930 (Thursday's high), then at 0.7954 (Wednesday's high); breach would target 0.8006 (Tuesday's high), then 0.8015 (200-day moving average), 0.8027 (Nov. 20 high), 0.8039 (Nov. 19 reaction high) and 0.8046 (Oct. 15 reaction high).
Write to Jerry Tan at jerry.tan@wsj.com
This is a financial news and information service. It is provided in general terms and does not take account of or address any individual user's position. To the extent that this article includes suggestions as to various possible investment strategies which users might consider, it does so in only general terms without reference to the personal factors which should determine any user's investment decisions. Nothing contained in this service constitutes personalized investment advice. Dow Jones does not warrant the accuracy, completeness or timeliness of the information in this article, and any errors shall 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. This article does not constitute or form part of any invitation or inducement to buy or sell any security.
(END) Dow Jones Newswires
December 18, 2014 18:30 ET (23:30 GMT)
December 18, 2014 18:30 ET (23:30 GMT)
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