(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. The daily USD/CNY chart is mildly bullish due to the effect of the Bollinger uptrend channel - which came into play two weeks ago and charts a gradual path up toward 6.2226 where the top of the Ichimoku Cloud consolidation zone awaits. But unless the dollar manages a clean break of the Cloud ceiling, the rally may not sustain, and the yuan may recoup recent losses. The HSBC China flash manufacturing PMI for June due at 0145 GMT could steer Shanghai stocks lower to extend last week's 13% drop if it disappoints versus last month's final reading of 49.2. Stocks have entered correction territory as punters unload existing positions on stricter margin-trading rules and fresh IPO releases. Dow Jones technical analysis suggests immediate support for spot USD/CNY is at 6.2080 (base of daily Bollinger uptrend channel), then at 6.2042 (base of daily Ichimoku Cloud support and 20-day Bollinger mid). Immediate resistance is at 6.2119 (top of daily Bollinger uptrend channel), then at 6.2226 (top of daily Ichimoku Cloud resistance zone), before 6.2441 (weekly Bollinger uptrend channel).
USD/TWD--possible downtrend. USD/TWD may be about to trigger a couple of bearish technical signals as it probes the 30.820 entrance of the daily Bollinger downtrend channel and also the base of the Ichimoku Cloud support zone at 30.770. A Tuesday close below the latter may prompt more U.S. dollar selling and thus steer the pair toward the 30.500 base of the weekly Bollinger downtrend channel. The U.S. dollar may face a fresh downdraft as the euro firms up on the apparent progress made in talks between Greece and the Eurogroup ministers for the release of bailout funds needed to meet debt repayments due end-June. Dow Jones technical analysis suggests immediate support is at 30.820 (daily Bollinger downtrend channel), then at 30.770 (base of daily Ichimoku Cloud support zone), before 30.610 (base of daily Bollinger downtrend channel). Immediate resistance is likely at 31.000 (round-figure trading barrier, then at 31.030 (20-day Bollinger mid resistance), before 31.100 (top of daily Ichimoku Cloud resistance zone).
USD/KRW--consolidation lower. USD/KRW opens slightly higher Tuesday but the pair is still capped by the daily Bollinger downtrend channel at 1,104 and may hence slide back down. A daily close below 1,102 would place USD/KRW inside the daily Ichimoku Cloud consolidation zone, suggesting that the pair drifts within a lower range of 1,087-1,102 in the near term. Traders are watching the euro for a trading signal for USD/Asia in general as optimism grows for a deal between Greece and its creditors soon. If the latest proposal to trim the Greek budget is indeed approved, the euro will likely rally, depressing the U.S. dollar index and thus send the safe haven greenback lower across the board. Dow Jones technical analysis suggests immediate support is at 1,102 (daily Ichimoku Cloud support), then at 1,100 (round-figure trading barrier), before 1,090 (round-figure trading barrier). Immediate resistance is at 1,104 (top of daily Bollinger downtrend channel), then at 1,110 (round-figure trading barrier and 20-day Bollinger mid resistance), before 1,118 (daily Bollinger uptrend channel).
USD/SGD--downtrend. While USD/SGD has been steady the last few days, a couple of bearish technical signs on the daily chart may soon weigh the pair lower. USD/SGD is inside the daily Bollinger downtrend channel and also below the daily Ichimoku Cloud support zone, suggesting that the Singapore dollar will add to gains versus the U.S. unit in the near term. The pair could easily slide to the 1.3200 round-figure trading barrier if a catalyst - such as a sharp euro rally - appears. The increasing possibility of a last-minute deal between Greece and its creditors - to unlock bailout funds - would stave off Grexit worries and thereby send investors back into riskier assets and currencies. On Monday, German stocks surged on apparent progress made in talks between Greece and the Eurogroup ministers. Dow Jones technical analysis shows immediate support is at 1.3307 (base of daily Bollinger downtrend channel), then at 1.3300 (round-figure trading barrier), before 1.3250 (psychological support). Immediate resistance is 1.3358 (daily Ichimoku Cloud resistance), then at 1.3377 (top of daily Bollinger downtrend channel), before 1.3400 (round-figure trading barrier).
USD/MYR--consolidation lower. USD/MYR could test the 20-day Bollinger mid line support as hopes rise for a deal between Greece and its creditors that would allow the former to meet debt repayments due in a week. If Greece's latest budget restructuring plan gains approval from Eurogroup creditors, the euro will likely rally and thereby depress the U.S. dollar index, sending a signal to USD/Asia traders to sell. The daily chart for USD/MYR would turn bearish for the near-term if the pair manages a daily closing below 3.6780 and thus inside the Bollinger downtrend channel. Confirmation of this chart signal would imply more ringgit strength versus the greenback ahead. Dow Jones technical analysis suggests immediate support is at 3.7170 (20-day Bollinger mid support), then at 3.7000 (round-figure trading barrier), before 3.6800 (psychological support). Immediate resistance is at 3.7500 (psychological resistance), then at 3.7560 (daily Bollinger uptrend channel), before 3.7800 (psychological resistance).
USD/THB--consolidation. USD/THB continues to bob in a narrow range of 33.62-33.76 demarcated by the respective entrances to the daily Bollinger downtrend and uptrend channels. The pair has been unreactive to external events recently, despite broad weakness seen in other USD/Asia currency pairs on assurances from the U.S. Federal Reserve last week that interest rates won't be raised in a hurry. While traders may be awaiting the outcome of Greece-Eurogroup budget negotiations for a signal to trade the U.S. dollar, another catalyst may come from the HSBC China flash manufacturing PMI for June due soon. If the data deviates sharply from last month's final reading of 49.2, risk-taking appetite could be affected and thus move emerging market currencies such as the baht. Dow Jones technical analysis suggests immediate support is at 33.62 (daily Bollinger downtrend channel), then at 33.55 (daily Bollinger downtrend channel), before 33.50 (psychological support). Immediate resistance is at 33.69 (20-day Bollinger mid resistance), then at 33.76 (daily Bollinger uptrend channel), before 33.83 (daily Bollinger uptrend channel).
USD/PHP--consolidation. USD/PHP may linger in a range of 44.88-45.09 as technical momentum appears to have faded. The pair on Monday nullified a bullish chart signal that appeared Friday and may now slip back down to the 20-day Bollinger mid support line at 44.88. Traders may still be looking at the euro for directional cues for the U.S. dollar in Asia today, but later in the week, the Philippine central bank policy meeting on Thursday may provide a stronger fundamental driver for the peso. The central bank has said that a rate cut is not needed for now, but if there is a surprise change in policy, USD/PHP is likely to react significantly and thereby trigger fresh technical signals. Dow Jones technical analysis suggests immediate support is at 45.00 (round-figure trading barrier), then at 44.88 (20-day Bollinger mid support), before 44.80 (psychological support). Immediate resistance is likely at 45.09 (daily Bollinger uptrend channel), then at 45.20 (psychological resistance), before 45.31 (top of daily Bollinger uptrend channel).
USD/IDR--consolidation lower. The rupiah and other emerging market currencies may benefit on optimism that Greece will clinch a last-minute deal for the release of bailout funds needed to meet debt repayments due in a week. USD/IDR is slipping under the long-term bullish trendline projected from mid-April, and could retrace lower to the 13,230 entrance of the daily Bollinger downtrend channel. If this barrier is breached on a daily closing basis, there might be even more rupiah strength versus the greenback ahead. Besides a possible spike in euro volatility on Greece-Eurogroup negotiations, another external factor that might spark a move in USD/IDR is the HSBC China flash manufacturing PMI for June due soon. A strong number might spur risk-taking and pressure the greenback lower broadly. Dow Jones technical analysis suggests immediate support for spot USD/IDR is at 13,310 (April trendline support), then at 13,280 (20-day Bollinger mid support), before 13,230 (daily Bollinger downtrend channel). Immediate resistance is at 13,340 (daily Bollinger uptrend channel), then at 13,400 (top of daily Bollinger uptrend channel), before 13,500 (psychological resistance).
(MORE TO FOLLOW) Dow Jones Newswires
June 22, 2015 20:55 ET (00:55 GMT)
USD/INR--consolidation lower. USD/INR may slide within the daily Ichimoku Cloud support zone that spans 63.15-63.57 as the Bollinger downtrend channel, which came into effect on Friday, guides the pair lower. The rupee could hence appreciate against the dollar but its gains may be limited unless USD/INR manages to break through the 63.15 floor of the Ichimoku Cloud support zone. A confirmed break could see USD/INR swiftly fall past the round-figure trading barrier of 63.00 and to the weekly Cloud support at around 62.25. The U.S. dollar may weaken dramatically if the euro surges on confirmation of a Greece-Eurogroup deal to unlock bailout funds - which could happen anytime soon. India stocks rose for a seventh straight session Monday, which might encourage more foreign participation that might add to rupee strength in the medium term. Dow Jones technical analysis suggests immediate support is at 63.40 (base of daily Bollinger downtrend channel), then at 63.15 (base of daily Ichimoku Cloud support zone), before 63.00 (round-figure trading barrier). Immediate resistance is likely at 63.56 (top of daily Ichimoku Cloud consolidation zone), then at 63.61 (top of daily Bollinger downtrend channel), before 63.82 (20-day Bollinger mid resistance).
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
June 22, 2015 20:55 ET (00:55 GMT)
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