Range Markets

JPY and AUD are the top G10 gainer up 0.21% and 0.13%, respectively (versus the dollar). The top losers are GBP and NOK down 0.21% and 0.15%, respectively. The USD-index is consolidating after recovering sharply yesterday; this raises chances that the current choppy range may continue for a bit longer than expected. In the equities space, the Nikkei has closed 0.61% higher for the day and the European equities have opened higher with FTSE at +0.1%, DAX at +0.1% and CAC +0.3%. In the rates market, the US and Bund 10-year yield both remain fairly weak with the US 10-year at 2.77% and the Bund 10-year yield at 0.50%. In the energy space, the Brent front month is trading slightly weak, just under the $70.0 mark, at $69.61, having left a Doji candle on Wednesday (shows indecision). In terms of the data, the German unemployment numbers dropped more than expected (-19.K actual vs 15K expected); EURUSD has recovered slightly from day’s lows but we see the impact from data limited. Elsewhere, UK Q4 GDP (final) came in as expected and we see no impact on GBP. Looking ahead, the German inflation rate at 1300 GMT and US PCE data at 1330 GMT are the key releases for the rest of the day. 


10-year Yields Daily chart (12-month)



USD-Index Daily chart (2-month)



Brent Front month Daily chart (2-Month)



Trade weighted basket Hourly chart (1-Week)




Major Currency Pairs


EURUSD Chart (Two-week)



Strategy: Support at 1.2259 for 1.2332
Short-term view: EUR/USD has strong support at 1.2259 and daily MACD has inched above the zero line. Hence, we expect a bounce to 1.2332. Below 1.2259 to open 1.2225


GBPUSD Chart (Two-week)



Strategy: Resistance at 1.4095 for 1.3987
Short-term view: GBP/USD has broken an uptrend and resistance at 1.4095 has held firm. Hence, we see risk of a dip to 1.3987. Above 1.4095 to open 1.4136


USDJPY Chart (Two-week)



Strategy: Resistance at 107.00 for 105.80
Short-term view: USD/JPY has resistance at 107.00 and we may see a correction to 105.80. That said, a Marubozu candle was seen on Wednesday and hence while above 105.80 chances are for a further upside to 107.36.


AUDUSD Chart (Two-week)



Strategy: Resistance at 0.7703 for .7623
Short-term view: AUD/USD has strong resistance at .7703, a bearish engulfing candle was completed on Tuesday and short-term MACD has dipped below the zero line. Hence, we expect a dip to .7627. Above .7703 to open .7740.


BTCUSD Hourly Chart (Two-week)



(Chart by Reuters)


Strategy: Resistance at $7820 for $7328
Short-term view: BTC/USD MACD started to move down, resistance at 7820. Hence, we see a further dip to 7328. Above 7820 to open towards 8000.


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