Forex Technical Analysis

Foreign exchange market. European session: the euro traded mixed against the U.S. dollar after the release of the mixed economic data from the Eurozone

Economic calendar (GMT0):

(Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual)

00:30 Australia Retail Sales, M/M December 0.4% 0.5% 0.0%

00:30 Australia RBA Monetary Policy Statement

05:00 Japan Leading Economic Index (Preliminary) December 103.2 Revised From 103.5 102.8 102.0

05:00 Japan Coincident Index (Preliminary) December 111.9 111.2

07:00 Germany Factory Orders s.a. (MoM) December 1.5% -0.5% -0.7%

07:45 France Trade Balance, bln December -4.53 Revised From -4.63 -4.4 -3.94

The U.S. dollar traded mixed against the most major currencies ahead of the release of the U.S. economic data. Analysts expect that U.S. unemployment rate is expected to remain unchanged at 5.0% in January. The U.S. economy is expected to add 190,000 jobs in January, after adding 292,000 jobs in December.

The U.S. trade deficit is expected to widen to $43.0 billion in December from $42.37 billion in November.

The euro traded mixed against the U.S. dollar after the release of the mixed economic data from the Eurozone. Destatis released its factory orders data for Germany on Friday. German seasonal adjusted factory orders declined 0.7% in December, missing expectations for a 0.5% decrease, after a 1.5% rise in November.

The drop was driven by a decrease in domestic orders. Foreign orders increased by 0.6% in December, while domestic orders dropped by 2.5%.

New orders from the Eurozone declined 6.9% in December, while orders from other countries climbed 5.5%.

Orders of the intermediate goods decreased by 2.0% in December, capital goods orders were down 0.5%, while consumer goods orders climbed 4.3%.

According to the French Customs, France's trade deficit narrowed to €3.94 billion in December from €4.53 billion in November, exceeding expectations for a decline to a deficit of €4.4 billion. November's figure was revised up from a deficit of €4.63 billion.

Exports declined 0.9% in December, while imports dropped 2.2%.

On a yearly basis, exports rose 1.8% in December, while imports gained 2.9%.

In 2015 as whole, the trade deficit fell to €45.7 billion from €58.3 billion in 2014.

The British pound traded mixed against the U.S. dollar in the absence of any major economic reports from the U.K.

The Canadian dollar traded mixed against the U.S. dollar ahead of the Canadian economic data. The unemployment rate in Canada is expected to remain unchanged at 7.1% in January.

Canada's economy is expected to add 5,500 jobs in January.

The Canadian trade deficit is expected to widen to C$2.2 billion in December from C$1.99 billion in November.

EUR/USD: the currency pair traded mixed

GBP/USD: the currency pair traded mixed

USD/JPY: the currency pair traded mixed

The most important news that are expected (GMT0):

13:30 Canada Trade balance, billions December -1.99 -2.2

13:30 Canada Unemployment rate January 7.1% 7.1%

13:30 Canada Employment January 22.8 5.5

13:30 U.S. Average hourly earnings January 0% 0.3%

13:30 U.S. Average workweek January 34.5 34.5

13:30 U.S. International Trade, bln December -42.37 -43

13:30 U.S. Unemployment Rate January 5% 5%

13:30 U.S. Nonfarm Payrolls January 292 190

15:00 Canada Ivey Purchasing Managers Index January 49.9 50

[...]

AUD/USD bullish, targets 0.7260 – UOB

The Aussie dollar could be heading towards the 0.7260 area, according to the research team at UOB Group.

Key Quotes

“We shifted to a bullish stance yesterday targeting a move to 0.7260. Currently, there is no change to the view”.

“A break above 0.7260 would shift the focus to 0.7330. Stop-loss is unchanged at 0.7070 even though 0.7150/55 is already a strong support”.

The Aussie dollar could be heading towards the 0.7260 area, according to the research team at UOB Group...

(Market News Provided by FXstreet) [...]

USD/JPY supported around 116.00/115.50 – Commerzbank

Karen Jones, Head of FICC Technical Analysis at Commerzbank, sees bearish attempts in the pair to find support around 116.00/115.50.

Key Quotes

USD/JPY remains under pressure following its recent failure ahead of the 78.6% Fibonacci retracement at 121.96, the current lunge lower should find some support circa 116.00/115.50”.

“Intraday rallies are indicated to terminate 117.60/118.25. This guards the 121.70 recent high”.

Karen Jones, Head of FICC Technical Analysis at Commerzbank, sees bearish attempts in the pair to find support around 116.00/115.50...

(Market News Provided by FXstreet) [...]

Germany’s Merkel praises ECB’s accommodative policy

German chancellor Angela Merkel, while speaking at the press conference after meeting Portuguese PM Costa, called the ECB’s ultra easy policy as favorable for Eurozone economic growth.

Merkel also said low oil prices are also helping the economy. Meanwhile, PM Costa said the Portuguese budget is responsible and the economic policies stick to the EU rules.

German chancellor Angela Merkel, while speaking at the press conference after meeting Portuguese PM Costa, called the ECB’s ultra easy policy as favorable for Eurozone economic growth.

(Market News Provided by FXstreet) [...]

Orders

EUR/USD Offers 1.1200-05 1.1220 1.1235 1.125011275 1.1300 1.1330 1.1350 Bids 1.1180 1.1160 1.1130 1.1100 1.1080 1.1065 1.1050 1.1030 1.1000 1.0980 1.0950 GBP/USD Offers 1.4550 1.4575-80 1.4600 1.4625 1.4645-50 1.4665 1.4685 1.4700 Bi... [...]

SAR still trailing the falling USD/NOK rate

We see an injection of volatility in the already heavy looking USD/NOK pair.

The washout in today's trading has expanded the Bollinger® bandwidth indicator for four consecutive hours beyond the maximum width seen in a week of trading. Moreover, the same 1hr charts show recent close prices printing below the 50-period EMA, a bearish condition that should it persist, would help keep the SAR indicator trailing above the price.

A change of direction would be quickly noticed by the SAR, implying USD/NOK shorts are taking profit. Risks exist the volatility and the plummeting price action extend to higher time frames.


SAR still trailing the falling USD/NOK rate

(Market News Provided by FXstreet) [...]

Fed’s ‘wait-and-see’ for longer? – TDS

In view of strategists at TD Securities, Yellen’s testimony next week could lean towards further ‘wait-and-see’ mode by the Fed.

Key Quotes

“Janet Yellen will make her semi-annual testimony on Capital Hill. TD expects Yellen’s remarks to be mostly balanced, reinforcing the Fed’s “wait and see” mode”.

“At the same time she will continue to reiterate the Fed’s optimistic outlook for growth and inflation, though she will likely highlight the increased uncertainty surrounding that outlook”.

“TD expects the tone of Yellen’s remarks to be mostly dovish, reinforcing the lowered odds of a March hike”.

In view of strategists at TD Securities, Yellen’s testimony next week could lean towards further ‘wait-and-see’ mode by the Fed...

(Market News Provided by FXstreet) [...]