Financial market research and analysis

EURUSD is expected to remain rangebound between the 100 and 200-day moving averages (1.0912 and 1.1045) moving into the critical ECB meeting tomorrow. The key mid-term resistance at 1.1047/51 (200-dma / Fib 38.2% retrace on Dec-Feb rise) is expected to shelter some offers before the meeting. Vanilla calls are however ready to support a move above the 1.1050 strike at today’s expiry for a further advance to 1.1100 mark before 1.1175 (minor 23.6% retrace on Dec-Feb rise) and 1.1376 (Feb 11th high). Below 1.1047/51 area, the EURUSD is considered in the bearish trend with the possibility of pullback to 1.0912 (100dma), then to 1.0826 (Mar 2nd low). A break below this level could pave the way to 1.0800/10 (February lows) then all the way down to the 1.0725 (minor 74.6% before 1.0524 (Dec low).

USDJPY collapsed to 112.23, further damaging hopes to see a bullish reversal by surpassing the critical 115.08 level (major 38.2% retrace, 115.08, on Jan 29 – Feb 11 slide). Light support is eyed at 112.00, last week’s low. A break below will fully expose the February dip of 110.99 (Feb dip).

GBPUSD is a better bid following the 0.7% expansion in UK manufacturing production during the month of January. Having triumphed against the 1.42 offers against the US dollar, the pound is now ready to grasp the 1.43 mark, which had been damaged after David Cameron fixed the Brexit referendum date two weeks ago. Trend and momentum indicators are stronger and a break above the 1.4300 could trigger an advance to 1.4350. Support is eyed at 1.4154, major 38.2% on February-March decline, if broken could signal a further pullback to 1.4032/1.4000 (minor 23.6% / psychological support).

AUDUSD consolidates gains just below the 75 cents. The RSI (68%) is now warning that the pair is approaching the overbought area and some correction could be expected at the current levels. The critical short-term support is seen at 0.7352/41 (50-week moving average / major 38.2% retrace on Feb 29th – Mar 7th rise), expected to lend a base to the current bullish development. Above 0.75, the AUDUSD could extend gains to 0.7655 (Fib 61.8% retrace on May-Jan decline) yet the risk of a verbal intervention from the RBA could increasingly weigh on the current enthusiasm, as macro players could find interest in selling the Aussie on dovish RBA expectations.

Gold eased to $1251.70 on stronger US dollar. The daily MACD has stepped in the bearish zone, suggesting that further downside recovery could be expected if $1250 is cleared. The $1225 (minor 23.6% on Dec-Mar rise) should lend support before the $1200 mark. On the upside, the $1280 needs to be cleared before considering a sustainable extension to $1300.

Crude prices tanked in New York yesterday after having extended gains to a fresh 3-month high of $38.39. The sentiment is positive before the US inventories data, due today. WTI is hovering around the 100-dma ($36.90) and should clear $38.40 (Maar 8th high) before a further rise to the $40 mark. On the downside, support is seen at $34.85 (200-hma), then at the 50-dma ($32.30). If support at this level is broken, we could expect to see a further fall toward the $30 mark.