Daily Market Outlook: February 2, 2015

EUR/USD

The euro trades in near-term directionless mode, with near-term action moving in narrowing range, after recovery rejection at 1.1421 and subsequent easing being contained at 1.1260, 50% of 1.1096/1.1421. Action remains capped by daily 10SMA and Tenkan-sen, holding below which, keeps the downside vulnerable. Bearish extension could be expected on clear break below 1.1260 range floor, with confirmation seen on a slide below 1220 higher base and Fibonacci 61.8% retracement of 1.1096/1.1421 rally, to re-focus fresh low of 26 Jan at 1.1096 and next target at psychological 1.1000 support. Conversely, close above daily 10SMA and Tenkan-sen, is required to avert downside risk and signal fresh upside action, with break of pivotal 1.1421, 27 Jan high and 1.1458, 16 Jan former low, to confirm bullish acceleration..

Res: 1.1366; 1.1387; 1.1421; 1.1458
Sup: 1.1277; 1.1260; 1.1220; 1.1172




EUR/JPY

The pair trades in near-term sideways mode, entrenched within narrow range. However, near-term studies remain weak, with bearish daily technicals and daily 10SMA capping, sees the upside limited for now. Only sustained break above daily 10SMA and close above 134.35, congestion top, would signal fresh extension of near-term recovery from 130.13 low, towards initial barriers at 134.56/68, Fibonacci 38.2% of 141.76/130.13 descend / former low of 16 Jan. Otherwise, fresh weakness could be expected on completion of consolidative phase, while 10SMA stays intact. Close below 132 handle, to confirm bears in play for further retracement of 130.13/134.35 yesterday’s low and range floor, to confirm.

Res: 133.37; 134.17; 134.35; 134.68
Sup: 132.73; 132.38; 131.74; 131.13




GBP/USD


Cable holds neutral near-term tone, confirmed by Friday’s Doji, suggesting further consolidation above fresh low at 1.4950, posted on 23 Jan. However, overall picture remains bearish and sees scope for fresh attempts lower, on completion of near-term consolidative phase, as the action remains capped by descending daily 20SMA. Only close above here and violation of pivotal 1.5221/67 barriers, would neutralize downside risk of fresh extension of larger downtrend towards 2013 higher base at 1.4830/12.

Res: 1.5094; 1.5160; 1.5221; 1.5267
Sup: 1.5016; 1.4950; 1.4910; 1.4830




USD/JPY

Near-term price action weakens after one-week sideways trading, confirmed by weekly Doji, was cracked on week’s gap-lower opening, which broke below 117.20 range floor and dipped to 116.86, where support was found. Subsequent bounce that filled today’s gap and cracked Fibonacci 61.8% retracement of 118.47/116.86 downleg, on extension to 118.86 so far, averts immediate downside risk and signals further consolidation. However, bearish tone that dominates on all timeframes, is expected to keep the downside vulnerable, while the price hold below pivotal barriers of daily 20SMA at 118.00 and daily cloud top at 118.43. Only close above here to confirm further recovery and neutralize risk of retesting pivotal 115.83 and 115.55 supports.

Res: 117.86; 118.00; 118.43; 118.64
Sup: 117.20; 116.86; 116.55; 115.83



AUD/USD

The pair remains bearish overall, with near-term price action trading in consolidative phase, off fresh low at 0.7718, where bears found temporary footstep, ahead of 0.7700, July 2009 low and near-term target. Weekly close below Fibonacci 61.8% at 0.7945, confirms bearish structure and sees scope for resumption of larger downmove, once consolidative phase is completed. Stronger corrective action, however, should hold below descending daily 10SMA, currently at 0.7924, to keep the structure intact. Only break and close above here, would signal further corrective action. Near-term price action is likely to hold within limited range, as the pair awaits tomorrow’s RBA’s rate decision.

Res: 0.7800; 0.7856; 0.7906; 0.7940
Sup: 0.7730; 0.7718; 0.7700; 0.7650




AUD/NZD


Near-term studies are gaining traction and the price stabilizes above 1.07 handle, after corrective pullback off 1.0792 peaks, found ground at 1.0660, where daily 55SMA contained pullback. Bullish setup of the daily technicals and near-term price action being supported by rising bull-trendline, drawn off 1.0350 low, favors fresh attempt at pivotal 1.08 zone, close above which to signal resumption of recovery rally from 1.0350 towards strong barrier at 1.0880, daily Ichimoku cloud top, reinforced by 200SMA. Penetration here would confirm further retracement of 1301/1.0350 downleg.

Res: 1.0736; 1.0765; 1.0792; 1.0864
Sup: 1.0658; 1.0620; 1.0571; 1.0520




XAU/USD

Spot Gold holds positive near-term tone and consolidates at 1280 zone, following rally from 200SMA at 1251, where pullback from 1307 high, found support. Past two-day price action moves within 200 and 10SMA’s, with ascending daily 20SMA keeping the downside protected and 20/200SMA’s golden cross, underpinning the action. Mixed near-term studies signal further consolidation, ahead of fresh attempt higher, as daily picture is bullish, with 1272, former low of 27 Jan / Fibonacci 38.2% of 1251/1284 upleg, reinforced by hourly SMA’s double bullish cross, expected to ideally contain dips. Sustained break above near-term congestion tops and daily 10SMA, is required to confirm resumption of rally from 1251 and open 1297/1300, highs of 27 / 26 Jan, ahead of pivotal 1307, 22 Jan peak. Otherwise, extension below 1272 handle, would signal further easing and re-focus key 1251 support, loss of which will be bearish and confirm reversal.

Res: 1284; 1292; 1297; 1300
Sup: 1276; 1272; 1264; 1258