The EUR/USD pair closed the week marginally higher at 1.0530

EUR/USD

The EUR/USD pair closed the week marginally higher at 1.0530, failing to sustain gains beyond the 1.0600 threshold for a second consecutive day following the release of a mixed US Nonfarm Payrolls report. The US economy added "just" 158K new jobs in December, below market's expectations of 178K, while the unemployment rate ticked higher as expected, from 4.6% to 4.7%. However, the details within the report where much better than the headline reading, as wages surprised to the upside, with average hourly earnings grew by 2.9% in December from previous 2.6%, its highest rate of growth since June 2009. On a monthly basis, hourly earnings rose by 0.4%, against previous month's decline of -0.1%. Gains in salaries offset concerns triggered by FOMC's Minutes, and reaffirmed FED's conviction of the labour market's strength. 

Data coming from Europe was positive once again, as business and consumers sentiment for December remains strong, as the Economic Sentiment Indicator for the region increased to 107.8 from an upwardly revised 106.6, in line with the upward momentum of the economy seen late 2016. However, the imbalance between Central Banks and the political risks within the EU, kept the EUR subdued. 

From a technical point of view, the pair failed to hold on  to gains above 1.0600 for a second consecutive week, whilst posting a lower high. Additionally, the price was unable to establish above the 23.6% retracement of the November/January decline, at 1.0565, suggesting that weakness will likely persist. In the daily chart, the price is currently above a bearish 20 DMA, around 1.0445, but far below sharply bearish 100 and 200 DMAs, whist technical indicators have turned modestly lower within positive territory, indicating that the pair may resume its decline on a break below the mentioned 1.0445 dynamic support. In the 4 hours chart, a bullish 20 SMA stands a few pips below the current price, the RSI indicator has lost directional strength within neutral territory, while the Momentum indicator retreated sharply from overbought territory, but still holds above 100, also suggesting that further signs are needed to confirm a steeper decline. 

Support levels: 1.0530 1.0490 1.0445 

Resistance levels: 1.0565 1.0615 1.0650 

USD/JPY

After posting a fresh 3-week low of 115.06, the USD/JPY pair closed the week flat a couple of pips below the 117.00 level, with the Japanese yen undermined by a recovery in USD-related assets. On Friday, and following a mixed US employment report, which showed less-than-expected jobs' creation, but a strong gain in wages, US yields bounced back from multi-week lows, while stocks posted all-time highs, with the DJIA flirting with 20,000. Further gains are still to be confirmed,  as the daily chart shows that technical indicators have turned sharply higher, and are currently struggling to confirm an upward extension into positive territory, whilst the 100 DMA extended further above the 200 DMA, both far below the current level. In the 4 hours chart, technical indicators have recovered from oversold readings, but pared gains below their mid-lines, having lost upward momentum, whilst the price bounced from a bullish 200 SMA, but was unable to extend beyond the 100 SMA, now at 117.40. It would take a clear advance beyond this last to confirm additional gains, back towards the 118.60 price zone. 

Support levels: 116.55 116.10 115.70 

Resistance levels: 117.00 117.40 117.90

GBP/USD

Following a recovery up to 1.2432, the GBP/USD pair plunged on Friday, to close the week down at 1.2284, undermined by persistent fears about Brexit. UK's data released at the beginning of the year showed that the economy expanded during the last quarter of 2017 at a faster-than-expected pace, but that was not enough to appease concerns about the future, after Jonathan Faull, the British official in the European Commission, who retired this January after the failed attempt to keep the UK in the EU, said that  access to the single market is not "for sale," implicating that the kingdom  will be unable to buy privileged access to the single market after leaving the EU. From a technical point of view,  the daily chart shows that the price advanced temporarily above a bearish 20 SMA, now around 1.2365, and even beyond the 38.2% retracement of the latest daily decline before sinking. In the same chart, technical indicators have turned south after failing to surpass their mid-lines, maintaining the risk towards the downside. In the shorter term and according to the 4 hours chart, the downside is also favored, with the 20 SMA converging with the 23.6% retracement of the mentioned side around 1.2330, and technical indicators now flat around their mid-lines, after correcting the overbought conditions reached a day before. 

Support levels: 1.2260 1.2220 1.2185

Resistance levels: 1.2330 1.2365 1.2410

AUD/USD

The AUD/USD pair pulled back from a weekly high of 0.7356, but closed it with solid gains anyway, at 0,7295. The Aussie benefited from strong Chinese data, which, in turn,  meant a sharp recovery in base metals' prices. Weighing on the pair on Friday was the US monthly Nonfarm Payrolls report, as despite the US economy created less jobs than expected, the details were somehow encouraging. Wages, measured yearly basis, rose to their highest since 2009, whilst the underemployment rate, one of FED's favorites measures of unemployment, improved to 9.2%. Technically, the pair retreated after correcting the 50% of its latest slump between 0.7254 and 0.7159. Daily basis, the price holds well above a bearish 20 SMA and around the 38.2% retracement of the same slide, whilst technical indicators have lost upward momentum and turned slightly lower within neutral territory, all of which limits chances of further gains. In the 4 hours chart, the price was unable to advance beyond its 200 EMA, which converges with the mentioned 50% retracement, whilst technical indicators maintain their strong bearish slopes and are about to cross their mid-lines into negative territory. A strong static support is now located at 0.7270, with a break below it opening doors for a steeper decline to sub-0.72 readings. 

Support: levels: 0.7270 0.7230 0.7190 

Resistance levels: 0.7315 0.7350 0.7400 

Dow Jones

Wall Street edged higher last Friday, with the Dow Jones Industrial Average coming within 0.37 points of 20,000 hitting 19,999.63 intraday, to close the week at 19,963.80, up by 64 points or 0.32%. The S&P 500 advanced roughly 8 points, or 0.35%, to 2,276.99, trading in record territory, whilst the Nasdaq Composite added 33 points or 0.60% to settle at 5,521.06. Looking beyond the negative headline of the US Nonfarm Payrolls report released on Friday, wages growth hit a new post-recession high, as average hourly earnings increased by 2.9% YoY. Nike was the best performer within the Dow, up by 1.60%, followed by Walt Disney, up by 1.49% and Goldman Sachs that gained 1.48%. The daily chart presents a modest upward potential, as the index is holding above a flat 20 DMA, but far above the 100 and 200 DMAs, whilst technical indicators turned modestly higher, but with no strength, and with the Momentum indicator still around 100. In the 4 hours chart, the 20 and 100 SMAs converge around 19,895, providing a major dynamic support, whilst technical indicators turned lower within positive territory, not enough to confirm an upcoming bearish move. 

Support levels: 19,940 19,895 19,853    

Resistance levels: 20,000 20,045 20,100

FTSE 100

The FTSE 100 posted its seventh consecutive record close,  ending Friday at 7,210.05, up by 14 points or 0.20%. Having started the day in the red, the index benefited from a weaker Pound, while a recovery in the banking sector offset the poor performance on mining-related equities. The best performer was BAE Systems, up by 2.98%, followed by Lloyds Banking group that surged by 1.93%. Leading losers' list was Fresnillo, down 3.51%, followed by Randgold Resources that shed 2.83%. The Footsie maintains its bullish tone according to technical readings, as indicators resumed their advances, with modest upward slopes, within positive territory, while the benchmark advanced further above a bullish 20 DMA. In the 4 hours chart, the index remains well above a bullish 20 SMA, with buying interest still surging on approaches to it, and currently at 7,178, while technical indicators hold flat above their mid-lines, lacking upward momentum amid the limited intraday ranges seen lately. 

Support levels: 7,178 7,146 7,110 

Resistance levels: 7,229 7,260 7,295

DAX

European equities closed modestly higher on Friday, with the German DAX advancing 14 points to 11,599.01, undermined by poor German data, as new orders in manufacturing fell by 2.5% in November when compared to the previous month, while retail sales in the same month fell by 1.8% against expectations of a 06% decline. Among the DAX, bank equities recovered some ground, with Deutsche Bank closing up 0.60% and Commerzbank ending the day unchanged. From a technical point of view, however, the risk remains towards the upside, as the benchmark holds near the multi-year high posted last Tuesday at 11,650, and in the daily chart, the RSI indicator turned modestly higher around 75, whilst the Momentum holds within positive territory and the 20 DMA heads higher well below the current level. In the 4 hours chart, the neutral-to-bullish stance persists, with the index a few points above a modestly bullish 20 SMA, the Momentum indicator stuck around its 100 level and the RSI hovering around 62. 

Support levels: 11,569 11,512 11,458

Resistance levels: 11,623 11,689 11,743

Nikkei

The Nikkei 225 closed last Friday 0.34% or 66 points lower at 19,454.33, weighed by a stronger yen and the negative tone of Wall Street of the previous session. Car makers were among the worst performers, led by the continued decline in Toyota that lost 1.69%, after US upcoming president, Donald Trump, threatened to impose punitive taxes on car imported into the US from Mexico, as the company was planning to establish a new plant in Mexico. Yamaha Motor lost 3.73% while Mazda closed 3.17% lower. The Japanese benchmark recovered some ground in after-hours trading, following the sharp recovery in US stocks, now poised to open the week at 19,594. Daily basis, the index maintains a positive tone, trading not far from the multi-month high reached this week at 19,622, and having bounce from a bullish 20 DMA, while technical indicators bounced modestly from their mid-lines, not enough at this point to support a sharper recovery. In the 4 hours chart,  the index holds above all of its moving averages, with the 20 SMA heading higher around 19,482, whilst technical indicators lack directional strength, but hold within positive territory. A break above the mentioned high is required to confirm further gains. 

Support levels: 19,560 19,506 19,443 

Resistance levels: 19,662 19,710 19,775

Gold

Spot gold closed with solid gains for a second consecutive week at $1,172.86 a troy ounce, having traded as high as 1,184.86 on  Thursday, its highest in over a month. Despite demand for US-related attests resumed after the release of the monthly employment report, gold held on to gains, somehow confirming an interim bottom at December's low of 1,122.62. Technically, the advance is still seen as corrective in the longer term, as the price settled around the 23.6%, retracement of the post-election decline, and the commodity is at risk of resuming its decline any time, particularly if confidence in the US and the greenback persists. In the daily chart, technical indicators have pulled back modestly after approaching overbought territory, while the price is well above a flat 20 SMA, all of which limits chances of a downward move. In the 4 hours chart, the price holds above a bullish 20 SMA that crossed above the 100 and 200 ones, whilst technical indicators having turned flat within positive territory, after correcting overbought conditions, in line with the longer term outlook. 

Support levels: 1,173.10 1,165.20 1,156.15    

Resistance levels: 1,179.20 1,184.90 1,191.30 

WTI Crude Oil

Crude oil prices closed the week pretty much unchanged, with West Texas Intermediate futures settling at $53.68 a barrel, weighed by dollar's strength and despite positive news in the sector. After falling to 52.11 on Tuesday, the commodity bounced on news that the OPEC is compiling its commitment to reduce output, and a large draw-down in US crude stockpiles. The EIA reported that stockpiles decreased by 7.1 million barrels in the last week of the year, while people familiar with the matter, said that Saudi Arabia has cut its crude-oil production by at least by 486,000 barrels per day, while Kuwait also reduced oil production this January, to around 2.7 million barrels per day, last Friday. From a technical point of view, however, the black gold has continued to lose upward momentum, and seems to have entered a consolidative stage, as in the daily chart, the price is above a horizontal 20 SMA, whilst technical indicators show no directional strength, but hold within positive territory. In the 4 hours chart,  the 20 and 100 SMAs converge around 53.30, while technical indicators have also turned flat within positive territory, suggesting further consolidation ahead. 

Support levels: 53.30 52.60 51.90    

Resistance levels: 54.20 55.00 55.75

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