(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 higher. USD/CNY may rise toward the top of its current consolidation range as the U.S. dollar index rebounded sharply overnight on euro weakness. The daily USD/CNY benchmark rate set by the People's Bank of China will hence likely be raised from Monday's 6.1079. But spot USD/CNY lacks momentum unless it can break out of the consolidation range that spans 6.1986-6.2101. Overnight, the U.S. dollar roared back higher after the euro fell 1.0% and U.S. Treasury yields rose. Although Wall Street closed at record highs, there remains a tone of general risk aversion as Greece is running out of time to cobble together a deal that would allow it to meet its upcoming debt repayment obligations. China's April house price index released Monday fell 0.12% on-month versus a 0.16% drop the previous month, suggesting that there may yet be room for economic stimulus measures. Dow Jones technical analysis suggests immediate support for spot USD/CNY is at 6.2043 (20-day Bollinger mid support), then at 6.2000 (round-figure trading barrier), before 6.1986 (daily Bollinger downtrend channel). Immediate resistance is at 6.2101 (daily Bollinger uptrend channel), then at 6.2133 (daily Ichimoku Cloud resistance zone), before 6.2158 (top of daily Bollinger uptrend channel).
USD/TWD--consolidation within downtrend. USD/TWD may gravitate toward the ceiling of the Bollinger downtrend channel due to overnight U.S. dollar strength. The sharp tumble of the euro Monday - on fears of Greece edging closer toward default and a possible exit from the eurozone - boosted the safe haven greenback. If USD/TWD ends Tuesday above 30.670 the bearish signal of the Bollinger downtrend channel will be extinguished and the pair might rally further on short-covering. The offshore USD/TWD market may also turn less bearish due to general risk aversion. The price difference between the 1-month contract and the spot contract could contract from Monday's discount of -0.045. Dow Jones technical analysis suggests immediate support is at 30.580 (weekly Ichimoku Cloud support and base of weekly Bollinger downtrend channel), then at 30.500 (base of daily Bollinger downtrend channel and psychological support), before 30.290 (base of weekly Ichimoku Cloud support zone). Immediate resistance is likely at 30.670 (top of daily Bollinger downtrend channel), then at 30.840 (20-day Bollinger mid resistance), before 31.000 (round-figure trading barrier and daily Bollinger uptrend channel).
USD/KRW--possible uptrend. USD/KRW gapped higher Tuesday and is now probing the entrance to the daily Bollinger uptrend channel after an overnight surge of the U.S. dollar index - triggered by the euro's tumble on Greece concerns. The USD/KRW pair will take on a bullish chart bias for the near-term if it closes Tuesday above 1,091. From there, the pair may aim for the round-figure trading barrier of 1,100. The safe haven greenback is rallying in Asia Tuesday as punters short the euro on a possible Greece exit from the eurozone as its coffers shrink and a deal with the Eurogroup seems out of reach. Dow Jones technical analysis suggests immediate support is at 1,091 (base of daily Bollinger uptrend channel), then at 1,090 (round-figure trading barrier), before 1,083 (20-day Bollinger mid support). Immediate resistance is 1,099 (top of daily Bollinger uptrend channel), then at 1,100 (round-figure trading barrier), before 1,104 (daily Ichimoku Cloud resistance zone).
USD/SGD--rebound higher. USD/SGD shot up overnight due to the slump of EUR/USD on mounting Greek concerns. The safe haven U.S. dollar is stronger across the board - a sign of general risk aversion - despite Wall Street closing at record highs Monday. USD/SGD is likely to rally past the 20-day Bollinger mid resistance line which currently caps at 1.3287 and then head for the Bollinger utprend channel at 1.3361. The ongoing Greece negotiations appear to be making little headway even as its cash reserves dry up. The possibility of a Greek exit from the eurozone has triggered fresh euro selling and thus U.S. dollar strength. Overnight, the benchmark U.S. 10-year Treasury yield rose to 2.24% from around 2.15%, thus adding to bullish pressure on the greenback. Dow Jones technical analysis shows immediate support is at 1.3214 (daily Bollinger downtrend channel), then at 1.3200 (round-figure trading barrier), before 1.3150 (psychological support). Immediate resistance is 1.3287 (20-day Bollinger mid resistance), then at 1.3300 (round-figure trading barrier), before 1.3361 (daily Bollinger uptrend channel).
USD/MYR--consolidation higher. USD/MYR has confirmed a rebound off a key chart support - the entrance of the daily Bollinger downtrend channel - after an overnight resurgence of the U.S. dollar index following four days of losses. USD/MYR is now likely to rally toward the entrance of the Bollinger uptrend channel at 3.6030 as punters trim bearish-USD bets. A Tuesday close above that mark would lend the pair a bullish bias on the short-term chart. There wasn't a clear trigger for the euro's overnight tumble which bumped up the U.S. dollar index, but ongoing Greek concerns about its ability to make a deal with the Troika before its cash reserves run out was cited as the main factor. Dow Jones technical analysis suggests immediate support is at 3.5820 (20-day Bollinger mid support), then at 3.5610 (daily Bollinger downtrend channel), before 3.5400 (base of daily Bollinger downtrend channel). Immediate resistance is at 3.6000 (round-figure trading barrier), then at 3.6030 (daily Bollinger uptrend channel), before 3.6340 (daily Ichimoku Cloud resistance).
USD/THB--consolidation higher. Overnight U.S. dollar index strength coupled with the increasing likelihood of another Bank of Thailand interest rate cut ought to lift USD/THB back toward the Bollinger uptrend channel. A Tuesday close above 33.59 would confirm this bullish chart signal and would encourage more U.S. dollar buying. Thailand's Q1 gross domestic product data published Monday showed a slower-than-expected expansion of 3.0% versus forecasts for 3.4%. The government hinted that it hopes the BOT will ease monetary policy again. Overnight, the U.S. dollar index rebounded after four straight days of losses, extinguishing its previous bearish chart bias. The sharp reversal of the euro - on re-emerging Greek default concerns - was the main reason for the greenback's bounce. Dow Jones technical analysis suggests immediate support is at 33.20 (psychological support), before 33.16 (20-day Bollinger mid support). Immediate resistance is at 33.50 (psychological resistance), then at 33.59 (daily Bollinger uptrend channel), before 33.80 (psychological resistance).
USD/PHP--consolidation higher. USD/PHP may bounce back above the daily Ichimoku Cloud consolidation zone after an overnight resurgence of the U.S. dollar index. The pair could consolidate slightly higher in the near term if it closes Monday above 44.53 and thus above the Cloud. The safe haven U.S. dollar is stronger across Asia due to risk aversion brewing as Greece default fears re-emerge. The overnight rise of U.S. Treasury bond yields also played a part in pushing the greenback higher. If stock markets in the region slide despite the Wall Street closing at record highs on Monday, risk aversion could escalate and drive USD/PHP into the Bollinger uptrend channel at 44.65. Dow Jones technical analysis suggests immediate support is at 44.46 (20-day Bollinger mid support), then at 44.44 (base of daily Ichimoku Cloud support), before 44.39 (200-day moving average line). Immediate resistance is likely at 44.53 (top of daily Ichimoku Cloud consolidation zone), then at 44.65 (daily Bollinger uptrend channel), before 44.84 (top of daily Bollinger uptrend channel).
USD/IDR--uptrend. USD/IDR clambered back into the daily Bollinger uptrend channel Monday and may receive a further boost from the overnight surge of the U.S. dollar index - on Greece default concerns that hammered the euro 1.0% lower. The USD/IDR pair now targets the 13,220 top of the daily Bollinger uptrend channel, and may chalk up a 17-year high if it surpasses the 13,245 peak in March. The Bank of Indonesia monetary policy decision due later is unlikely to surprise the market. Analysts expect BI to hold the base interest rate at 7.5% because of high inflation and concerns over the currency and current account deficit. On Monday, U.S. 10-year Treasury yield rose to 2.24% from around 2.15%, thus adding to bullish pressure on the greenback. Dow Jones technical analysis suggests immediate support for spot USD/IDR is at 13,120 (base of daily Bollinger uptrend channel), then at 13,040 (daily Ichimoku Cloud support and 20-day Bollinger mid support), before 13,000 (round-figure trading barrier). Immediate resistance is at 13,200 (psychological resistance), then at 13,220 (top of daily Bollinger uptrend channel), before 13,300 (top of weekly Bollinger uptrend channel).
(MORE TO FOLLOW) Dow Jones Newswires
May 18, 2015 21:01 ET (01:01 GMT)
USD/INR--possible uptrend. USD/INR may creep back into the daily Bollinger uptrend channel as the U.S. dollar index surged Monday following pronounced euro weakness. The rise of Greek debt default concerns sent EUR/USD tumbling overnight, nullifying its previous bullish chart bias and thus triggering more selling by short-term speculators. If USD/INR closes Tuesday above 63.89 it would be inside the Bollinger uptrend channel and could keep rising toward the 64.20 ceiling of the channel. The rupee may fluctuate with more volatility in the weeks ahead as the Reserve Bank of India's June 3 policy meeting approaches; a rate cut may be on the cards due to slowing growth, say some analysts. Dow Jones technical analysis suggests immediate support is at 63.57 (20-day Bollinger mid support), then at 63.27 (daily Bollinger downtrend channel), before 63.00 (round-figure trading barrier). Immediate resistance is likely at 63.89 (daily Bollinger uptrend channel), then at 64.00 (round-figure trading barrier), before 64.20 (top of daily Bollinger uptrend channel).
Write to Ewen Chew at ewen.chew@dowjones.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
May 18, 2015 21:01 ET (01:01 GMT)
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