Financial market research and analysis

EURUSD remains ranged before the ECB decision and President Draghi’s press conference. Trend and momentum indicators remain flat and a breakout of the 1.0800/1.1050 is needed to asses a fresh short-term direction. The key mid-term resistance is eyed at 1.1052 (200dma). The ECB is expected to maintain the status quoi at this week’s meeting, the accompanying tone will be important. Until then, we see little incentive to step out of 1.08/1.1050 range in EURUSD.

USDJPY hit 115.98 yesterday and traded from green to red in Tokyo. PM Abe’s aide urged the BoJ to react to halt the yen appreciation while BoJ Governor Kuroda showed no incentive for immediate stimulus. The 200hma (117.50) has capped the bullish attempt and the USD softness suggest more resistance before 117.82 (minor 23.6% on Nov-Jan decline) and 118.95 (major 38.2%). Buyers are eyed at 115.75/57 (Dec’14 low).

GBPUSD Below 1.4250/60, there is possibility of further attempt to 1.4040/1.4000 psychological support. Surpassing 1.4250/60 resistance, a bumpy recovery toward 1.4392 (minor 23.6% on Dec-Jan decline) could be considered. Key resistance is eyed at 1.4500/555 (major 38.2%).

AUDUSD bounced higher from 0.6830/45 weekly support zone, pulled out 0.6945 resistance (minor 23.6% on Dec 31 to date decline) and is looking to challenge the 0.6960 pivot before bumping into offers pre-0.7000/0.7017 (major 38.2%). Mixed vanilla expiries at 0.70 for today. On the downside, key support is seen at 0.6830/0.6800 zone, if broken should give way to 0.6765/0.6750 weekly level.

Increased volatility among equity markets helped revitalize Gold demand, gold advanced to $1104.67. The safe-haven metal is expected to see some more support from risk-averse bulls. With support at 1085, the yellow metal could gather enough momentum to surpass 1105/1115 offers and target 1125/1130 (one-month uptrend channel top).

WTI consolidates losses below $30. Trend and momentum indicators point the downside, with minor upside attempts expected to face offers at $30/34.50. From a weekly perspective, a further slide to $25 is not a delusion but with many pundits in a race to predict more dramatic declines and the fact that this oil price demise is firmly in the mainstream media, we cannot rule out a volatile shot squeeze higher.