(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--possible upside. An uptick in the U.S. dollar index overnight could result in a higher daily USD/CNY daily benchmark rate that might boost spot USD/CNY. A Wednesday close inside the daily Bollinger uptrend channel at 6.2198 would lend a bullish technical bias to spot USD/CNY that suggests further yuan weakness against the dollar ahead. The highlight of the day will be the possible announcement of new liquidity-easing measures by both the Bank of Japan and the European Central Bank, which both ought to fuel the U.S. dollar higher. Dow Jones technical analysis suggests immediate support for spot USD/CNY is at 6.2099 (20-day Bollinger mid support), then at 6.2000 (round-figure trading barrier and daily Bollinger downtrend channel), before 6.1900 (base of daily Bollinger downtrend channel). Immediate resistance is at 6.2198 (daily Bollinger uptrend channel), then at 6.2297 (top of daily Bollinger uptrend channel), before 6.2500 (round-figure trading barrier).
USD/TWD--rebound. USD/TWD may rebound toward the daily Bollinger uptrend channel as the U.S. dollar index rallied again overnight ahead of potentially USD-bullish policy decisions by the Bank of Japan and the European Central Bank. A Wednesday close above the 20-day Bollinger mid at 31.750 would increase the chances that the Bollinger uptrend channel, which was nullified Jan. 12, could be reinstated. The price difference between the benchmark 1-month USD/TWD contract and that of the spot contract has turned around from a discount to a premium, suggesting that speculative traders are now bullish on the greenback. Dow Jones technical analysis suggests immediate support is at 31.600 (daily Bollinger downtrend channel), then at 31.440 (base of daily Bollinger downtrend channel and psychological support), before 31.200 (psychological support). Immediate resistance is likely at 31.750 (20-day Bollinger mid resistance), then at 31.910 (daily Bollinger uptrend channel), before 32.000 (round-figure trading barrier).
USD/KRW--consolidation higher. USD/KRW has busted out of the daily Bollinger downtrend channel and is now climbing toward the 20-day Bollinger mid resistance at 1,093 as the greenback surges broadly ahead of the Bank of Japan policy decision as well as the likely announcement of quantitative easing measures by the European Central bank later in the day. USD/KRW is technically in a consolidation mode within the daily Ichimoku Cloud resistance zone that spans 1,084-1,106 but a Wednesday close above the 20-day Bollinger mid line might increase the likelihood of an interim rally higher within the Cloud. Dow Jones technical analysis suggests immediate support is at 1,090 (round-figure trading barrier), then at 1,084 (base of daily Ichimoku Cloud support and entrance to daily Bollinger downtrend channel), before 1,074 (base of daily Bollinger downtrend channel). Immediate resistance is at 1,093 (20-day Bollinger mid resistance), then at 1,100 (round-figure trading barrier), before 1,102 (daily Bollinger uptrend channel).
USD/SGD--uptrend. USD/SGD is building on its bullish technical bias as it climbs higher for a third day and deeper into the daily Bollinger uptrend channel, which now supports at 1.3360. A couple of influential factors are pushing the U.S. dollar higher in Asia. A possible extension of liquidity-easing measures by the Bank of Japan in its policy decision due soon, and the European Central Bank's meeting, which is expected to result in more easing measures, are both positive factors for the U.S. dollar. USD/SGD may be charting a path toward the 1.3500 round-figure trading barrier on a Wednesday close above 1.3360. Dow Jones technical analysis shows immediate support is at 1.3360 (base of daily Bollinger uptrend channel), then at 1.3303 (20-day Bollinger mid support), before 1.3300 (round-figure trading barrier). Immediate resistance is at 1.3400 (round-figure trading barrier), then at 1.3416 (top of daily Bollinger uptrend channel), before 1.3500 (round-figure trading barrier).
USD/MYR--uptrend. Malaysia's ringgit has hit a new six-year low of 3.6240 -- a level not seen since April 2009 -- a day after the government issued a growth forecast downgrade in its budgetary policy update and remained silent on the impact of oil prices on its currency. An onshore trader said the market is approaching panic mode as liquidity is very poor Wednesday morning, with the price of the spot USD/MYR contract gapping from 3.6150 to 3.6240 within minutes due to a lack of U.S. dollar sellers. The greenback is steamrolling higher across the board ahead of the Bank of Japan and the European Central Bank policy decisions, which could both be positive for the U.S. dollar. Overnight, oil prices stayed weak, adding to pressure on the ringgit. The market is still unconvinced by Prime Minster Najib Razak's Tuesday assertion that Malaysia is a net petroleum importer. Dow Jones technical analysis suggests immediate support is at 3.6000 (round-figure trading barrier), then at 3.5890 (base of daily Bollinger uptrend channel), before 3.5800 (psychological support). Immediate resistance is at 3.6300 (top of daily Bollinger uptrend channel), then at 3.6500 (psychological resistance).
USD/THB--consolidation. USD/THB has overturned its bearish technical bias and is now back inside the daily Ichimoku Cloud resistance zone that spans 32.64-32.91. USD/THB may meet resistance at the 20-day Bollinger mid resistance line at 32.82 that has successfully fended off multiple attempts to rally through January. The overnight rally of the benchmark U.S. dollar index has lifted the greenback across the board in Asia. Currency speculators are betting that policy decisions due today by the Bank of Japan and the European Central Bank will be affirmative for the U.S. dollar. Dow Jones technical analysis suggests immediate support is at 32.71 (daily Bollinger downtrend channel), then at 32.64 (base of daily Ichimoku Cloud support zone), before 32.60 (base of daily Bollinger downtrend channel). Immediate resistance is at 32.82 (20-day Bollinger mid resistance), then at 32.91 (top of daily Ichimoku Cloud resistance zone), before 32.93 (daily Bollinger uptrend channel).
USD/PHP--possible rebound. USD/PHP may rebound back into the daily Ichimoku Cloud consolidation zone that looms at 44.77 as the U.S. dollar rallies across Asia. Speculators are placing bullish bets on the dollar before the policy decisions of the Bank of Japan and the European Central Bank are announced. The likelihood of more easing measures by the two central bank is high, which would be positive for the U.S. dollar. If USD/PHP ends the day above 44.93 and thus inside the daily Bollinger uptrend channel and above the Ichimoku Cloud resistance zone, there might be a lot more room for the dollar to rally. Dow Jones technical analysis suggests immediate support is at 44.61 (daily Bollinger downtrend channel), before 44.45 (base of daily Bollinger downtrend channel). Immediate resistance is likely at 44.77 (20-day Bollinger mid resistance and daily Ichimoku Cloud resistance), then at 44.93 (daily Bollinger uptrend channel and top of daily Ichimoku Cloud resistance), before 45.00 (round-figure trading barrier).
USD/IDR--possible uptrend. USD/IDR may break out higher from its current consolidation range and enter the daily Bollinger uptrend channel at 12,650 as a wave of U.S. dollar strength sweeps through Asia. The greenback is surging as speculators bet on further liquidity easing measures by the Bank of Japan and the European Central Bank, which ought to propel the U.S. dollar higher. A Wednesday close above 12,650 would increase the chances of a further rally back up to December high of 12,930. Dow Jones technical analysis suggests immediate support for spot USD/IDR is at 12,550 (20-day Bollinger mid support), then at 12,500 (psychological support), before 12,450 (daily Bollinger downtrend channel). Immediate resistance is at 12,650 (daily Bollinger uptrend channel), then at 12,750 (top of daily Bollinger uptrend channel), before 12,960 (top of monthly Bollinger uptrend channel).
USD/INR--consolidation higher. USD/INR may creep up toward the top of the daily Bollinger uptrend channel at 62.07 as broad greenback strength -- stemming from speculation on central bank policy decisions in Japan and Europe -- lifts most USD/Asia currency pairs. If the rally of the U.S. dollar extends substantially, two bearish USD/INR chart signals could be nullified and thereby trigger capitulation of short-USD/INR bets. A Wednesday close above 62.06 would negate the daily Bollinger downtrend channel and place USD/INR back inside the daily Ichimoku Cloud support zone. Dow Jones technical analysis suggests immediate support is at 61.50 (psychological support), then at 61.35 (base of daily Bollinger downtrend channel), before 61.00 (round-figure trading barrier). Immediate resistance is likely at 62.00 (round-figure trading barrier), before 62.06 (daily Ichimoku Cloud resistance and top of daily Bollinger downtrend channel), before 62.36 (top of daily Ichimoku Cloud resistance zone).
Write to Ewen Chew at ewen.chew@wsj.com
(MORE TO FOLLOW) Dow Jones Newswires
January 20, 2015 20:23 ET (01:23 GMT)
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