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28 Jul 2016
By Mauro Fellner
USD weaker despite Fed optimism
The US dollar lost territory against the Japanese yen on the lack of intervention from the Federal Reserve. Ahead of the Bank of Japan decision tomorrow, the USDJPY trades at 104.66, with next support seen at 104.24 (Fibonacci retracement), if cleared, could bring the pair towards the 100.00 mark. The BoJ is expected to add more stimulus through the monetary policy. If the BoJ manages to meet the expectations, we can expect the USDJPY to surge above 105.00 to 107.06 (100-day moving average), then towards 110.00/110.25 (Fibonacci retracement).
GBPUSD failed to consolidate post-Fed gains. The next resistance is seen at 1.3289 (July 22nd high), above that level, Cable could rally towards 1.3400/1.3415 (Fibonacci retracement). The first support is at 1.3165 (intraday low). Below, the pair could fall to 1.3056 (July 26th low). Clearing this level will pave the way towards 1.2849 (July 11th low).
Today, we expect a massive 2.9 billion options strike 0.7500 to expire. AUDUSD next resistance is seen at 0.7593/0.7600 mark (Fibonacci retracement), if surpassed, the pair could rally to 0.7700 mark, then extend gains to 0.7832 (April 21st top level).
On the downside, we see solid supports at 0.7466 (100-day moving average), then at 0.7455 (50-day moving average) and 0.7446 (major Fibonacci retracement). If these levels are cleared, AUDUSD could test the critical 0.7343 (200-day moving average).
Gold rallied above $1340 on weaker US dollar. The Fed's more hawkish than expected stance, has not been priced in the market, and gold can extend the bullish trend, and head towards $1374 (July 11th high). The first support is seen at $1336 (intraday low), if cleared, the price could move lower to $1310 (July 21st low), before 1300/1297 (Fibonacci retracement).
The US government data revealed a surprise rise in crude oil inventories (actual +1.7M barrels against -2.1M expected), after nine consecutive weeks of contraction. Oil producers are pumping in more oil than the market could absorb, and both benchmarks are tanking as a consequence. Brent is trading at $43.30, while WTI reached a 3-month low, on Thursday's sell-off below the $42.00 mark. If WTI breaks the $41.66 (July 27th low), we could a plunge towards $40.00 mark. Recovering above $42.00 a barrel could encourage some buyers to push the price towards the $42.46 resistance (50-hour moving average). Above that level, we could see an upside towards $43.00/43.08 (Fibonacci retracement).
The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest and nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please note that 71% of our retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing money.
