15/02/2023 Daily Reports
EUR/USD
- EUR/USD picks up extra pace and trespasses the key barrier at 1.0800 the figure on Tuesday, or multi-session highs. However, it failed to hold that gains and back to 1.0735 area to ended Tuesday, still bearish in the daily chart.
- Financial markets traded with an optimistic yet cautious tone throughout the first half of the day, as investors awaited the release of US inflation figures. The United States Consumer Price Index rose at an annualized pace of 6.4% in January, better than the previous 6.5% but missing the 6.2% expected.
- Financial markets struggled with the figures, as inflation eased, but at a slower-than-anticipated pace. That means the US Federal Reserve could keep tightening the monetary policy until achieving its 2% target. Markets moved away from high-yielding assets, with Wall Street edging sharply lower and the US Dollar surging.
- The EUR/USD pair is trading near the 1.0735, slightly up for the day with bearish stance in daily chart. The pair still stabilized below 20 and 50 SMA, indicates bearish strength. Meanwhile, the 20 SMA started turning south and heading towards longer ones, suggests bears not exhausted yet. On upside, the immediate resistance is 1.0800, break above this level will extend the advance to 1.0930.
- Technical readings in the daily chart support the bearish stance. The RSI indicator stabilizes around 48. The Momentum indicator holds below the midline, indicating downward potentials. On downside, the immediate support is 1.0650 and below this level will open the gate to 1.0580.
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GBP/USD
The GBP/USD dropped sharply in the North American session following the release of inflation data in the United States, which, although increased, initially sent the GBP/USD spiking towards its daily high at 1.2269 before reversing its course to the 1.2130 area. However, a late bounce sparked a recovery in the GBP/USD, trading at 1.2170, above its opening price.
After the CPI data release, US Treasury bond yields advanced, with the US 2-year Treasury bond yield edging towards 4.622%, as an initial reaction to the data, which warrants further tightening by the US Fed. Consequently, the greenback advanced, with the US Dollar Index peaking at around 103.83 before reversing its course, toward the 103.09 area.
Across the pond, data from the UK, capped GBP fall against the US Dollar. According to Reuters, wages in Britain grew quickly in the last quarter of 2022, keeping the BoE, pressured. Investors increased “slightly” their bets that the BoE would raise rates by 25 bps at their March meeting.
The GBP/USD offers bearish stance in daily chart. Cable stabilizes below 20 and 50 SMA, indicating bearish strength in short term. Meanwhile, the 20 SMA continued accelerating south and heading towards longer ones, suggests bears not exhausted yet. On upside, The immediate resistance is 1.2270 with a break above it exposing to 1.2400.
Technical readings in the daily chart support the neutral to bearish stances. RSI indicator stabilizes around 50, while the Momentum indicator stabilizes below the midline, suggesting downward potentials. On downside, the immediate support is 1.2110, unable to defend this level will resume the decline to 1.2020.
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XAU/USD
- Gold price is marginally far from reclaiming the critical resistance of $1,860.00. The precious metal recovered firmly after sensing buying interest around $1,850.00 as the US Dollar Index surrendered the immediate support of 102.80. The further downside in the USD Index looks favoured as the risk appetite of the market participants is extremely solid.
- Financial markets traded with an optimistic yet cautious tone throughout the first half of the day, as investors awaited the release of US inflation figures. The United States Consumer Price Index rose at an annualized pace of 6.4% in January, better than the previous 6.5% but missing the 6.2% expected.
- Despite a decline in the US CPI, the Fed won’t tone down its hawkish stance as the stubbornness in the inflationary pressures will take time in easing.
- Gold price stabilized around 1855, unchanged for the day and neutral to bearish in the daily chart. The gold price stabilized below 20 SMA, suggesting bearish strength in short term. Meanwhile, the 20 SMA started turning south and heading towards longer ones, indicating bears not exhausted yet. On upside, the immediate resistance is 1872, break above this level will open the gate for more advance to 1891 area.
- From a technical perspective, the RSI indicator holds below the mid-line and stabilizes around 42, on a bearish strength. The Momentum indicator hold below the midline, suggests downward potentials. On downside, the immediate support is 1850, below this area may resume the decline to 1830.
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USD/JPY
- The USD/JPY reached a new YTD high of 133.31, though it failed to cling to those gains, retracing beneath last week’s high of 132.90 after the release of US economic data, spurring a retracement. Therefore, the USD/JPY consolidates within the 132.70-133.00 area. At the time of writing, exchanges hands at 133.00.
- Fundamentally speaking, the Department of Labour revealed that inflation in the US cooled down annually but came slightly above estimates. The CPI for January rose by 6.4% YoY, above forecasts of 6.2%, while core CPI jumped to 5.6% YoY, against data estimated at 5.5%. Monthly basis readings were in line with estimates.
- On the Japanese front, the confirmation of the BoJ new Governor, Kazuo Ueda, sparked speculations that the BoJ would abandon the Yield Curve Control imposed under Governor Haruhiko Kuroda’s term. Thar should be considered bullish for the JPY, which has extended its losses in the North American session so far.
- The USD/JPY pair stabilized around 133.00, up for the day and bullish in the daily chart. The stabilizes above 20 and 50 SMA, suggests bullish strength in short term. However, 20 SMA continued developing far below longer ones, indicating bears not exhausted. On upside, overcome 133.30 may encourage bulls to challenge 134.70, break above that level will open the gate to 137.40.
- Technical indicators suggest the bullish strength. RSI stabilizes around 60, while the Momentum indicator stabilizes in the positive territory, suggests upward potentials. On downside, the immediate support is 131.50, break below this level will open the gate to 129.80 area.
DJI
- DJI pumped and dumped on Tuesday post CPI data released, jumped to intraday high 34548 area, but failed to hold the gains and made a U turn to downside and hit intraday low 33852. It ended the day around 34120, down for the day and indicates bearish sign in the hourly chart. Right now market is standing below 20 SMAs, suggests bearish strength. Meanwhile, 20 SMA started turning south and heading towards longer ones, suggests bears not exhausted yet. On upside, overcome 34370 may encourage bulls to challenge 34550, break above that level will open the gate to 34680.
- Technical indicators suggest the bearish movement, developing below the mid-line. RSI stabilizes around 47, while the Momentum indicator stabilizes in the negative territory, suggests downward potentials. On downside, the immediately support is 33850, break below this level will open the gate for more decline to 33550 area.
BRENT
- The Brent under the sell pressure, tumbled from intraday high 86.40 area to low 84.14. It trimmed some losses and ended the day around 85.60. The price currently stabilizes below 20 and 50 SMA, suggests bearish strength in the hourly chart. Meanwhile, the 20 SMA and 50 SMA started turning flat but continued developing far above 200 SMA, indicates bulls not exhausted yet. On upside, overcome 87.00 may encourage bulls to challenge 89.00, break above that level will open the gate to 90.00.
- Technical indicators also suggest bearish movement, hovering below the midline. RSI climbs to 47, while the Momentum indicator stabilizes in negative territory, suggests downward potentials. On downside, the immediately support is 85.00, break below this level will open the gate for more decline to 84.00 area.
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