European and U.S. equities rose on Wednesday, and Asian shares rose to near eight-week highs on Thursday, lifted by reports the European Central Bank will announce a 50 billion Euros per month bond-buying program to boost the Euro zone's declining economy. The Euro rose early against the Dollar on speculation Chief Draghi could disappoint in the magnitude of the stimulus, later gained on covering of short positions. Crude Oil prices limited gains on expectations that the ECB's decision to launch a bond-buying program could boost the Dollar and put downward pressure on the commodity. Gold pared gains on profit taking, after climbing above $1,300 on the proposed bond-buying stimulus. Investors have arrived to the highlight of the week, the key ECB meeting.
The Dollar slipped against the Euro yesterday after some traders cut back on risk by reversing long-standing bets against the Euro ahead of the European Central Bank's Thursday meeting.
EURUSD closed at $1.16137, up 0.58%, in our platform, yesterday.
Recent moves from central banks such as the Swiss National Bank and the Bank of Canada have irritated nerves and contributed to a cautious tone in markets. Investor nervousness rose after reports on the potential nature of the ECB's expected bond-buying program.
Today, expect the market to move with the ECB announcement and the U.S. jobless claims as it focus on the Greek election on Sunday.
Pivot
1.168
Support
1.154
1.1515
1.146
Resistance
1.168
1.172
1.1755
Scenario 1: Short positions below 1.168 with targets 1.154 & 1.1515 in extension.
Scenario 2: Above 1.168 look for further upside with 1.172 & 1.1755 as targets.
Comment: As long as the resistance at 1.168 is not surpassed, the risk of the break below 1.154 remains high.
The Canadian Dollar plunged against the U.S. Dollar to its weakest since April 2009, after the Bank of Canada shocked financial markets with its interest-rate cut.
USDCAD finished at C$1.23424, up 1.87% in our platform, yesterday.
Today, expect the market to move with the U.S. jobless claims and to pay extra attention to the EIA petroleum status report. Tomorrow Canada releases more important data.
Pivot
1.211
Support
1.211
1.2045
1.199
Resistance
1.243
1.2525
1.26
Scenario 1: Long positions above 1.211 with targets 1.243 & 1.2525 in extension.
Scenario 2: Below 1.211 look for further downside with 1.2045 & 1.199 as targets.
Comment: Technically the RSI is above its neutrality area at 50.
Gold was almost unchanged yesterday, after climbing above $1,300 an ounce for the first time since August, as profit-taking entered the market following reports of a proposed bond-buying program for the ECB.
Spot Gold closed at $1,292.18, almost unchanged in our platform, yesterday.
Thursday is the second biggest potential day of the season, outside of a Federal Reserve hike meeting, and the Gold market has decided to take some profit apparently unimpressed by Draghi's potential trillion Euro stimulus. Investor's interest on profit taking increased due to a swinging Dollar. Worries about the global economy persist in the Gold market.
Today, expect the market to move with the ECB announcement, the U.S. jobless claims and China's PMI flash manufacturing index early in the morning and to pay extra attention to the EIA petroleum status report as it focus on the Greek election on Sunday.
Pivot
1,284
Support
1,284
1,271.8
1,264
Resistance
1,310
1,317
1,325
Scenario 1: Long positions above 1,284 with targets 1,310 & 1,317 in extension.
Scenario 2: Below 1,284 look for further downside with 1,271.8 & 1,264 as targets.
Comment: A support base at 1284 has formed and has allowed for a temporary stabilisation.
OIL/USD
WTI Crude Oil rebounded from the biggest drop in a week amid signs that prices near a 5 1/2-year low are slowing drilling in the U.S.
WTI futures closed at $47.27, up 1.05%, or $0.49 in our platform, yesterday.
The rapid decline in Oil prices may deter investment in all types of energy needed to meet future demand that might pick up on a better looking U.S. economy, the head of the International Energy Agency said. Also traders are prepared for any hint on when production will come off.
Today, expect the market to move with the EIA petroleum status report and China's PMI flash manufacturing index early in the morning and to pay extra attention to the ECB announcement.
Pivot
46.35
Support
46.35
45.6
44.75
Resistance
48.25
49.2
50.8
Scenario 1: Long positions above 46.35 with targets 48.25 & 49.2 in extension.
Scenario 2: Below 46.35 look for further downside with 45.6 & 44.75 as targets.
Comment: The RSI is mixed.
DOW/USD
The U.S. stock market ended Wednesday's agitated trading day with modest gains, extending its winning streak to three sessions, as investors widely expect the ECB to deliver on monetary stimulus at its key meeting today.
The Dow Future closed at 17,491, up 0.32% in our platform, yesterday.
Stocks shook off earlier worries and turned higher after media reports said that the ECB is considering a bond-buying program of about €50 billion a month to help revive the declining Eurozone economy. The proposal calls for bond purchases that would last for a minimum of one year. Stock markets were further boosted by a jump in Oil prices as well as news that the Bank of Canada announced a surprise rate cut.
Today, expect the market to move with the ECB announcement, the U.S. jobless claims and China's PMI flash manufacturing index early in the morning and to pay extra attention to the EIA petroleum status report as it focus on the Greek election on Sunday.
Pivot
17,865
Support
17,865
17,700
17,560
Resistance
18,070
18,220
18,320
Scenario 1: Long positions above 17,865 with targets 18,070 & 18,220 in extension.
Scenario 2: Below 17,865 look for further downside with 17,700 & 17,560 as targets.
Comment: The RSI lacks downward momentum.