(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--downtrend. USD/CNY's recent downwards move may resume as the two-day relief rally appears to be running out of steam. The daily Bollinger downtrend channel remains in effect - contingent on a Wednesday close below 6.2262 - and may be augmented by a break of 6.2000 which is the base of the Ichimoku Cloud support zone and also a major round-figure trading barrier. The yuan has been gaining on hints from the head of the central bank that yuan liberalization is on the cards this year. China has been pushing for quicker interest rates and currency liberalization in order to be included in the International Monetary Fund's Special Drawing Rights currency basket. The HSBC China flash PMI for March released Tuesday may have disappointed at 49.2 versus the previous final reading for February of 50.7 but the stock market managed to brush it off. Shanghai stocks may continue to eke out gains on hopes that the authorities will be persuaded to ease monetary policy again. Dow Jones technical analysis suggests immediate support for spot USD/CNY is at 6.2000 (round-figure trading barrier and base of daily Ichimoku Cloud support), then at 6.1800 (psychological support), before 6.1682 (weekly Bollinger downtrend channel). Immediate resistance is at 6.2200 (psychological support), then at 6.2262 (top of daily Bollinger downtrend channel), before 6.2365 (top of daily Ichimoku Cloud resistance).
USD/TWD--downtrend. USD/TWD could keep sliding lower if it stays within the Bollinger downtrend channel that now caps at 31.320. A slight bounce in the U.S. dollar index overnight could prop up the pair, but risk appetite is generally still positive - possibly on hopes of China monetary policy stimulus - so the Taiwan dollar is likely to hold on to recent strength. The pricing of the benchmark 1-month nondeliverable forward contract versus that of the spot contract has gone deeper into discount - a sign of bearish speculative pressure in the offshore market - which may translate to a heavier tone in spot USD/TWD. USD/TWD could in the days ahead test the 31.000 round-figure trading barrier which if breached might trigger a landslide of stoploss-related dollar-selling. Dow Jones technical analysis suggests immediate support is at 31.170 (base of daily Bollinger downtrend channel), before 31.000 (round-figure trading barrier). Immediate resistance is likely at 31.320 (top of daily Bollinger downtrend channel), then at 31.460 (daily Ichimoku Cloud resistance), before 31.500 (psychological resistance).
USD/KRW--consolidation. USD/KRW may linger around its Tuesday closing level as the overnight rebound of the U.S. dollar index helps augment the 1,100 chart support not far below. The U.S. dollar recovered against the euro overnight, thus triggering mild short-covering in USD/Asia Wednesday. USD/KRW appears to be consolidating in a range of 1,100-1,115 for now, supported by the entrance to the Bollinger downtrend channel and capped by the 20-day Bollinger mid resistance line. U.S. data released Tuesday showed core inflation rose 1.7% on-year - slightly higher than expected - but the yield on the benchmark 10-year U.S. Treasury hence remained depressed just under 1.9%, which could prevent the dollar from rallying much higher for now. Dow Jones technical analysis suggests immediate support is at 1,100 (round-figure trading barrier and entrance of daily Bollinger downtrend channel), then at 1,097 (daily Ichimoku Cloud support), before 1,095 (base of daily Ichimoku Cloud support zone). Immediate resistance is at 1,110 (round-figure trading barrier), then at 1,115 (20-day Bollinger mid resistance), before 1,120 (round-figure trading barrier).
USD/SGD--consolidation higher. USD/SGD has come to rest at the entrance of the daily Bollinger downtrend channel as the U.S. dollar index found a floor overnight following two sharp consecutive declines. USD/SGD could consolidate slightly higher toward the 20-day Bollinger mid resistance at 1.3757 if short-term punters trim bearish-USD positions on signs that downwards momentum has faded. USD/SGD could also be supported as more analysts suggest that Singapore's central bank might ease monetary policy at its April meeting - after a fourth consecutive month of deflation in consumer prices. The form of easing might not be as drastic as re-centering the midpoint of the currency's regulated trading band - which would mean a revaluation - but could be in the form of a band-widening that would allow the Singapore dollar to weaken more than the MAS currently allows. Dow Jones technical analysis shows immediate support is at 1.3648 (daily Bollinger downtrend channel), then at 1.3539 (base of daily Bollinger downtrend channel), before 1.3500 (round-figure trading barrier). Immediate resistance is at 1.3700 (round-figure trading barrier), then at 1.3757 (20-day Bollinger mid resistance), before 1.3800 (round-figure trading barrier).
USD/MYR--consolidation. USD/MYR may stage a mild rebound back to the 20-day Bollinger mid line at 3.6660 after the U.S. dollar index managed to claw back from what would have been a third consecutive decline overnight. Oil prices slipping lower - due to the greenback's rebound - may play a part in supporting USD/MYR as well. Malaysia's ringgit is sensitive to movements in crude oil prices because of the significant size of the oil export industry. USD/MYR may hover within a broad range of 3.6260-3.7060 for the weeks ahead. Dow Jones technical analysis suggests immediate support is at 3.6260 (daily Bollinger downtrend channel), before 3.6000 (round-figure trading barrier). Immediate resistance is at 6.6500 (psychological resistance), then at 3.6660 (20-day Bollinger mid resistance), before 3.7000 (round-figure trading barrier).
USD/THB--consolidation. USD/THB has likely bottomed out at the 200-day moving average line after a three-day decline. The U.S. dollar's overnight bounce may help to keep this key chart support level intact - which could then lead to a rebound toward 32.63 where the daily Ichimoku Cloud resistance zone looms. Overnight, U.S. core inflation data may have discouraged bearish bets on the greenback. A slightly higher than expected rise in core inflation data - 1.7% on-year - may have spooked the recent short-sellers of the dollar who were betting against the U.S. Federal Reserve raising interest rates mid-year. Although there are a couple of factors still delaying a U.S. Federal Reserve rate hike in the near future, the fact that other central banks are cutting interest rates could keep USD/THB supported on dips. Dow Jones technical analysis suggests immediate support is at 32.47 (200-day moving average), then at 32.40 (daily Bollinger downtrend channel), before 32.20 (base of daily Bollinger downtrend channel). Immediate resistance is at 32.60 (20-day Bollinger mid resistance), then at 32.63 (daily Ichimoku Cloud resistance), before 32.78 (top of daily Ichimoku Cloud resistance).
USD/PHP--uptrend. USD/PHP may rise again - guided by the daily Bollinger uptrend channel - as the U.S. dollar index recovered from its recent selloff. The peso may come under extra pressure - aside from U.S. dollar short-covering - as the Philippine central bank on Tuesday said there is room for adjusting monetary policy if needed. Although Bangko Sentral ng Pilippinas said it will not be swayed by easing measures recently announced by regional central banks, there is a chance that a rate cut may come at its Thursday policy meeting. Regionally, inflation has been sliding due to dampened energy prices - and if the Philippines' inflation rate drops toward the lower end of the BSP's target range of 2%-4%, a rate cut might seem more possible. Dow Jones technical analysis suggests immediate support is at 44.61 (base of daily Bollinger uptrend channel), then at 44.59 (daily Ichimoku Cloud support), before 44.40 (base of daily Ichimoku Cloud), before 44.32 (20-day Bollinger mid support). Immediate resistance is likely at 44.80 (psychological resistance), then at 44.87 (top of daily Bollinger uptrend channel), before 45.00 (round-figure trading barrier).
USD/IDR--consolidation higher. USD/IDR may bounce out of the daily Bollinger uptrend channel - which it entered on Tuesday - due to overnight U.S. dollar strength against the major currencies. A Wednesday close above 12,930 would negate the bearish chart signal and could motivate short-covering in USD/IDR that might push the pair higher to 13,040 where the 20-day Bollinger mid resistance awaits. The catalyst for a the dollar's rebound may have been the slightly stronger than expected U.S. core inflation data released overnight. Core inflation rose 1.7% on-year, but is still short of reaching the 2.0% target that might prompt the U.S. Federal Reserve to adopt a more hawkish stance on interest rates. Analysts broadly predict the Fed will lift rates in September, which may support the greenback on dips. Dow Jones technical analysis suggests immediate support for spot USD/IDR is at 12,810 (base of daily Bollinger downtrend channel), before 12,660 (daily Ichimoku Cloud support zone). Immediate resistance is at 12,930 (top of daily Bollinger downtrend channel), then at 13,000 (round-figure trading barrier), before 13,040 (20-day Bollinger mid resistance).
(MORE TO FOLLOW) Dow Jones Newswires
March 24, 2015 20:55 ET (00:55 GMT)
USD/INR--consolidation higher. USD/INR could inch toward the topside of the daily Ichimoku Cloud consolidation zone which spans 62.00-62.57 after an overnight bounce in the U.S. dollar index. The pair will however still be lacking directional momentum unless it exits the broader range of 62.00-62.76 - which would then activate the Bollinger downtrend or uptrend channels respectively. The greenback found its feet overnight - after two straight losses - following a slightly higher than expected rise in U.S. core inflation. This measure of consumer price increases is the key data point that the U.S. Federal Reserve monitors in making its decision as to whether to raise interest rates. Once the Fed signals that rates need to be lifted, the U.S. dollar will likely rally. Dow Jones technical analysis suggests immediate support is at 62.00 (round-figure trading barrier and base of daily Ichimoku Cloud support and entrance of Bollinger downtrend channel), before 61.64 (base of daily Bollinger downtrend channel). Immediate resistance is likely at 62.39 (20-day Bollinger mid resistance), then at 62.57 (top of daily Ichimoku Cloud), before 62.76 (daily Bollinger uptrend channel).
Write to Ewen Chew at ewen.chew@wsj.com
(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
March 24, 2015 20:55 ET (00:55 GMT)
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0 Response to "USD/Asia Rebounds as U.S. Core Prices Rise -- Asia Daily Forex Outlook"
Thanks for give comment.