Financial market research and analysis

The EURUSD is better bid, helped by higher bund yields overnight. We could see a further upside correction to 1.0933 (200-hour moving average), 1.0952 (minor 23.6% retracement on Sep 26th to Oct 25th decline) and 1.1015 (major 38.2% retrace). Support is eyed at 1.0850/1.0860 (weekly lows).

The USDJPY consolidated gains between 104.30/104.70 in Tokyo, despite a broad based weakness in the US dollar. Nevertheless, the better US yields helped limiting the downside; the US 10-year yields stepped above 1.80% for the first time since June 2016. The hourly Ichimoku cloud base (104.30) is expected to lend support to the pair for a further extension to 105.00, before 105.50. More short-term support is eyed at 104.19 (100-hour moving average), 104.00 (200-hour moving average), 103.74 (minor 23.6% retracement on Sep 27th to Oct 25th rise), before the critical 103.04 (major 38.2% retracement).

The GBPUSD extended recovery to 1.2249, after clearing offers at 1.2207 (Fibonacci 50% on Oct 19th to Oct 25th decline). The next critical resistance is presumed at 1.2295 (major 38.2% retracement on Sep 28th to Oct 7th crash), before 1.2330 (weekly resistance). Intra-day supports are eyed at 1.2207 (resistance turned support), 1.2178 (major 38.2% retrace), before 1.2141 (minor 23.6% retrace) and 1.2080. Stops are eyed below.

The AUDUSD pared losses after bouncing lower from 0.7709 yesterday. The pair traded below its 200-hour moving average, 0.7644, in Sydney, while holding support at 0.7620 (Fibonacci 50% retracement Oct 13th to Oct 20th rise). More support is eyed at 0.7593 (major 61.8% retrace). Intra-day resistances stand at 0.7644/0.7653 (200 and 50-hour moving averages respectively), before 0.7680 (minor 23.6% retrace) and 0.7710/0.730, mid-term resistance area.

Gold trades at $10-15 range below its 200-day moving average, $1280, if cleared, should encourage a further recovery to $1297 (minor 23.6% retrace on Dec’15 to Jul’16 rise). Yet firmer US yields could dent the appetite in gold. Intra-day support is seen at $1260, while the $1255/1250 (major 38.2% retrace) is expected to maintain the base for the current bullish development.

The WTI continues its journey south on speculations that the OPEC's production cuts would rely mostly on Saudi Arabia’s shoulders given that many members ask to be exempt from cuts for several, understandable reasons: Iraq to fight ISIS, Iran to recover from multi-year sanctions, Libya and Nigeria due to damages their oil industries suffered from violences. We could see a deeper downside correction to $49.00/$48.80, before $48.30. Short-term resistances are eyed at $49.74 (minor 23.6% retracement on Oct 19th to Oct 26th fall) and $50.20 (major 38.2% retrace).