(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 yen-funded carry trades amid positive investor risk appetite (VIX fear gauge eased 17.52% to 19.44, S&P 500 closed up 2.04% at 2,012.89 overnight) on a supportive Federal Reserve which modified its 'considerable time' language, saying it 'can be patient' about the timing of the first rate hike, and its forecast of a slower pace of Fed rate increases in 2015 once they start; and on stabilization in Russia's currency from recent turmoil. USD/JPY also supported by demand from Japan importers; Bank of Japan's large-scale monetary easing policy; positive dollar sentiment (ICE spot dollar index last 89.07 versus 87.94 early Wednesday) and higher U.S. Treasury yields (10-year at 2.135% versus 2.071% late Tuesday) after Federal Reserve Chairwoman Yellen in a subsequent press conference said the central bank was unlikely to raise rates for the "next couple of meetings," and said she wanted to discourage the idea that the Fed would act only at meetings that are followed by news conferences, signaling the central bank could raise rates as early as its April 28-29 2015 meeting--the third meeting for 2015 which also doesn't include a news conference. That is sooner than the second half of 2015 that many investors currently expect. But USD/JPY gains tempered by softer-than-expected U.S. November CPI of -0.3% on-month (versus forecast -0.1%); Japan exporter sales. Data focus: 0130 GMT China November house price index; 1330 GMT U.S. jobless claims in week ended December 13 (forecast 295,000); 1445 GMT U.S. December flash Services PMI; 1500 GMT U.S. Conference Board November leading indicators (forecast +0.6%), U.S. December Philadelphia Fed business outlook survey (forecast 25.0 versus November's 40.8). Daily chart mixed as MACD bearish, but stochastics turned bullish near oversold levels. Resistance at 119.13-119.21 band (Monday's high-Friday'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 117.15 (hourly chart), then at 116.30 (Wednesday's low); breach would expose downside to 115.56 (Tuesday's low), then 115.44 (Nov. 17 low), 114.88 (Nov. 12 low), 113.84 (Nov. 10 low, near 55-day moving average).
EUR/USD--to trade in lower range. Undermined by positive dollar sentiment; ECB's Benoit Coeure saying in interview with The Wall Street Journal Wednesday that there's broad consensus on the central bank's council to introduce more stimulus in the eurozone, signaling that the ECB is poised to embark on large-scale asset purchases centered on government bonds early next year; euro sales on soft EUR/GBP cross; Greek government's failure Wednesday to secure majority in first round of parliament votes on new president--the next rounds are on Dec. 23 and Dec. 29--after the third failure, the government will call a snap general election. But EUR/USD losses tempered by euro demand on buoyant EUR/JPY cross amid positive risk sentiment. Data focus: 0900 GMT Germany December Ifo business climate index (forecast 105.5 versus November's 104.7), 1000 GMT eurozone October construction output. Daily chart mixed as MACD bullish, but stochastics turned bearish near overbought levels. Support at 1.2320 (Wednesday's low); breach would target 1.2292 (Dec. 9 low), then 1.2247-1.2239 band (Dec. 8 low-Aug. 10, 2012 low) and 1.2132 (Aug. 2, 2012 low). Resistance at 1.2473 (hourly chart), then at 1.2516 (Wednesday's high); breach would target 1.2570-1.2575 (Tuesday's high-Nov. 20 high), then 1.2599 (Nov. 19 reaction high) and 1.2770 (Oct. 29 reaction high).
AUD/USD--to consolidate with bearish bias after hitting four-and-a-half year low 0.8104 Wednesday. AUD/USD undermined by positive dollar sentiment; soft iron ore prices (fell $0.20 Wednesday to five-and-a-half year low $67.90/ton); recent jawboning against Aussie exchange rate from RBA officials. But AUD/USD losses tempered by Aussie demand on buoyant AUD/JPY cross amid improved risk appetite. Data focus: 0030 GMT Australia November official reserve assets. Daily chart negative-biased as MACD bearish; five- and 15-day moving averages declining; stochastics stays suppressed at oversold levels. Support at 0.8104 (Wednesday's 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). Resistance at 0.8235 (Wednesday's high, near 10-day exponential moving average); breach would target 0.8274 (Monday's high), then 0.8298 (Friday's high), 0.8375 (Dec. 11 high), 0.8392 (Dec. 5 high), 0.8429 (Dec. 4 high) and 0.8466 (Dec. 3 high).
NZD/USD--to trade in lower range. Mixed FX reaction this morning to NZ 3Q GDP data as on-quarter growth was stronger-than-expected at 1.0% (versus forecast +0.7%), but on-year growth was weaker-than-expected at +3.2% (versus forecast +3.3%). NZD/USD undermined by positive dollar sentiment. But NZD/USD losses tempered by Kiwi demand on buoyant NZD/JPY cross amid reduced risk aversion; firmer dairy prices; NZD-USD interest differential. Daily chart negative-biased as MACD and stochastics turned bearish. Support at 0.7682 (Wednesday'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). 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).
GBP/USD--to trade with bearish bias. Undermined by positive dollar sentiment. But sterling sentiment soothed by stronger-than-expected 1.6% rise in U.K. average earnings in the quarter ending in October (versus forecast +1.5% and higher than the U.K. October CPI of 1.3%), bigger-than-expected 26,900 drop in U.K. November jobless claimants (versus forecast -20,000), although U.K. unemployment rate in the three months to October was higher-than-expected at 6.0% (versus forecast 5.9%). GBP/USD losses also tempered by sterling demand on buoyant GBP/JPY cross amid diminished risk aversion; sterling demand on soft EUR/GBP cross. Data focus: 0930 GMT U.K. November retail sales (forecast +0.4% on-month, +4.5% on-year), November CML mortgage lending. Daily chart mixed as MACD bullish but stochastics in bearish mode. Support at 1.5543-1.5539 (Wednesday's low-Dec. 8 low); breach would target 1.5504 (Sept. 2, 2013 low), then 1.5426 (Aug. 28, 2013 reaction low) and 1.5205 (Aug. 7, 2013 low). Resistance at 1.5698 (hourly chart), 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).
USD/CHF--to trade in higher range. Underpinned by positive dollar sentiment; ultra-loose Swiss National Bank's monetary policy. But CHF sentiment boosted by rise in Switzerland ZEW-Credit Suisse economic sentiment indicator to minus 4.9 in December from minus 7.6 in November. USD/CHF gains also tempered by franc demand on buoyant CHF/JPY cross. Data focus: 0700 GMT Switzerland November trade balance. Daily chart mixed as MACD bearish, but stochastics turned bullish near oversold levels. Resistance at 0.9745 (Wednesday's high); breach would target 0.9778 (Dec. 9 high), then 0.9818 (one-and-a-half year high hit Dec. 8), 0.9972 (July 24, 2012 swing high), psychological 1.0000 line and 1.0066 (Dec. 1, 2010 reaction high). Support at 0.9627 (hourly chart), then at 0.9592 (Wednesday's low); breach would target 0.9552 (Tuesday's low), then 0.9530 (Nov. 19 reaction low), 0.9439 (Oct. 29 reaction low, near 100-day moving average), 0.9395 (Oct. 21 low) and 0.9358 (Oct. 15 reaction low).
USD/CAD--to consolidate with bullish bias after hitting five-year high 1.1673 Wednesday. CAD sentiment dented by smaller-than-expected 0.1% increase in Canada October wholesale sales (versus forecast +0.2%). USD/CAD also supported by positive dollar sentiment. But USD/CAD gains tempered by firmer oil prices (Nymex crude settled up 54 cents at $56.47/bbl Wednesday); loonie demand on buoyant CAD/JPY cross amid improved risk tolerance. Data focus: 1330 GMT Canada October employment insurance. Daily chart positive-biased as MACD bullish; stochastics stays elevated at overbought levels; five- and 15-day moving averages advancing. Resistance at 1.1673 (Wednesday's high); breach would expose upside to 1.1724 (July 8, 2009 reaction high), then 1.1814 (May 18, 2009 high). Support at 1.1557 (Wednesday's low), then at 1.1545 (Monday's low); breach would target 1.1512 (Friday's low), then 1.1449 (Dec. 11 low), 1.1430 (Dec. 10 low), 1.1394 (Dec. 9 low) and 1.1374 (Dec. 5 low).
EUR/JPY--to trade in higher range. Supported by positive risk sentiment; demand from Japan importers. But EUR/JPY gains tempered by Japan exporter sales. Daily chart mixed as MACD bearish, but stochastics turning bullish at oversold levels, inside-day-range pattern completed Wednesday. Resistance at 146.74 (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 145.36 (Wednesday's low), then at 144.96 (Tuesday's low); breach would target 144.75 (Nov. 17 low), then 144.27 (Nov. 14 low), 143.19 (Nov. 12 low) and 142.40 (55-day moving average).
(MORE TO FOLLOW) Dow Jones Newswires
December 17, 2014 18:59 ET (23:59 GMT)
EUR/GBP--to trade in lower range. Undermined by 1.6% rise in U.K. average earnings in the quarter ending in October, which was higher than the U.K. October CPI of 1.3%. Daily chart mixed as MACD bullish, but stochastics turned bearish. Support at 0.7905-0.7903 (Wednesday's low-Monday's low); breach would target 0.7864-0.7856 band (Friday's low-Dec. 9 low), then 0.7835-0.7828 band (Dec. 8 low-Dec. 3 low), 0.7794 (Nov. 12 low), 0.7781 (Oct. 2 low) and 0.7758-0.7753 (Sept. 30 reaction low-July 23, 2012 swing low). Resistance at 0.7954 (Wednesday's high), then at 0.8006 (Tuesday's high); breach would target 0.8027 (Nov. 20 high, near 200-day moving average), then 0.8039 (Nov. 19 reaction high), 0.8046 (Oct. 15 reaction high) and 0.8065 (Sept. 10 reaction high).
Write to Jerry Tan at jerry.tan@wsj.com
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(END) Dow Jones Newswires
December 17, 2014 18:59 ET (23:59 GMT)
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