European stocks hit 7-year high with Germany's DAX at a historic high and bonds yields reaching new lows on Monday as investors bet the ECB will unveil a bond-buying package this week to fight deflation and revive growth after the comments of the French President Francois Hollande, ignoring the steepest fall in Chinese shares since June 2008. With U.S. markets closed for the Martin Luther King Day holiday the Euro recovered some ground against the Dollar after hitting an 11-year low last week. In China, nervousness supported the Japanese Yen as financial shares were castigated with Beijing cracking down on credit products that have been blamed for fuelling excessive market speculation, the same type of investment that triggered the 2008 financial crisis. The IMF downgraded its forecast for 2015 World growth, blaming weakness in Japan and Europe, as it calls on advanced economies to maintain simulative monetary policies to avoid increases in real interest rates as cheaper Oil, which fell again yesterday, adds to the risk of deflation. The market is eagerly awaiting Thursday's ECB meeting.
The Euro moved away from an 11-year low on Monday as investors prepare for a crucial meeting later in the week which could see the European Central Bank take its boldest steps yet to revive the Euro zone's declining economy.
EURUSD closed at $1.15944, up 0.28%, in our platform, yesterday.
The ECB is widely expected to launch quantitative easing - effectively the printing of Euros to buy government bonds - when it meets in Frankfurt on Thursday. But it is unclear how the programme is designed, how big it is, and whether it will be seen as credible and sufficient.
Today, expect the market to pay extra attention to Germany's PPI, ZEW survey, CPI and U.S. housing market index as it focus on the ECB's policy meeting on Thursday.
Pivot
1.1545
Support
1.1545
1.1515
1.1455
Resistance
1.165
1.172
1.1795
Scenario 1: Long positions above 1.1545 with targets 1.165 & 1.172 in extension.
Scenario 2: Below 1.1545 look for further downside with 1.1515 & 1.1455 as targets.
Comment: The pair is pulling back on its support.
The Euro gained Monday against the Swiss Franc to trade above parity at 1.0200 francs, but it has still lost 16% against the Swiss currency since the SNB abandoned its cap of 1.20 Francs per Euro. Following the SNB action last week, there has been a probably unrealistic build-up of expectations that the ECB could make a Bank of Japan style shock and awe announcement. Traders said there would be volatility at the end of this week in the pair ahead of Greece's hurried election on Sunday which, with anti-bailout party Syriza leading in the polls, could further undermine the Euro zone's credibility.
EURCHF finished at F1.02005, up 2.72% in our platform, yesterday.
Today, expect the market to pay extra attention to Germany's PPI, ZEW survey, and CPI, as it focus on the ECB's policy meeting on Thursday.
Pivot
1.006
Support
1.006
0.99
0.974
Resistance
1.029
1.035
1.0465
Scenario 1: Long positions above 1.006 with targets 1.029 & 1.035 in extension.
Scenario 2: Below 1.006 look for further downside with 0.99 & 0.974 as targets.
Comment: The RSI lacks downward momentum.
Gold eased from four-month highs on Monday as investors cashed in some of last week's hefty gains, though prices were still supported by wider market volatility that boosted the metal's appeal as a haven from risk.
Spot Gold closed at $1,275.89, down 0.33% or $4.24, in our platform, yesterday.
Since the beginning of the year there have been several issues combined - economic anxiety in Europe, the Euro dropping to an eleven-year low, the ECB contemplating quantitative easing, Switzerland last week and Greece at the end of this week – that have supported the metal as the market prepares for volatility. Gold traders say that we are in a critical week for the Euro zone.
Today, expect the market to pay extra attention to Germany's PPI, ZEW survey, CPI, and U.S. housing market index as it focus on the ECB's policy meeting on Thursday.
Pivot
1,264
Support
1,264
1,256
1,245
Resistance
1,292
1,300
1,310
Scenario 1: Long positions above 1,264 with targets 1,292 & 1,300 in extension.
Scenario 2: Below 1,264 look for further downside with 1,256 & 1,245 as targets.
Comment: The RSI is mixed with a bullish bias.
OIL/USD
WTI Crude Oil declined from a one-week high after its first weekly gain in two months as Iraqi production advanced to a record, compounding a global supply surplus.
WTI futures closed at $47.81, down 2.07%, or $1.01 in our platform, yesterday.
OPEC has no immediate plan to cut its output target for Crude, Iran is strong enough to withstand a deeper slump in prices even if the country must sell at $25 a barrel, its Oil Minister said. The U.S. won't intervene in the Oil market amid falling Crude prices, according to the U.S. State Department's energy envoy. Oil also extended losses after Chinese shares plunged the most since 2008, and its economic growth failed to support confidence demand that will be enough to eliminate a global oversupply. And Crude found more pressure as the IMF downgraded its forecast for 2015 World growth.
Today, the market will be focusing on any potential stimulus coming from the ECB on Thursday.
Pivot
48.9
Support
45.95
45.05
44.2
Resistance
48.9
49.65
51.4
Scenario 1: Short positions below 48.9 with targets 45.95 & 45.05 in extension.
Scenario 2: Above 48.9 look for further upside with 49.65 & 51.4 as targets.
Comment: As long as 48.9 is resistance, likely decline to 45.95.
DAX/EUR
Germany's main stock index jumped to close at an all-time high for two days in a row with Europe's broad equity-market index closing higher Monday, hitting a seven-year high as investors weigh up the prospects for quantitative easing from the European Central Bank.
The Dax Future closed at 10,252.75, almost unchanged in our platform, yesterday.
Stocks on Monday reached session highs after French President François Hollande said policy makers at the ECB meeting on Thursday "will take the decision to buy sovereign debt, which will provide significant liquidity to the European economy and create a movement that is favorable to growth."
Today, expect the market to pay extra attention to Germany's PPI, ZEW survey, and CPI as it focus on the ECB's policy meeting on Thursday. 
Pivot
9,935
Support
9,935
9,780
9,650
Resistance
10,400
10,500
10,600
Scenario 1: Long positions above 9,935 with targets 10,400 & 10,500 in extension.
Scenario 2: Below 9,935 look for further downside with 9,780 & 9,650 as targets.
Comment: The RSI is bullish and calls for further advance.