The EUR/USD pair remained confined within familiar ranges this Wednesday

EUR/USD

The EUR/USD pair remained confined within familiar ranges this Wednesday, ending the day marginally lower below the 1.0600 mark. The pair however, extended its weekly slide down to 1.0552, as positive US data alongside with improved market sentiment supported the greenback.

In the data front, the EU headline estimated inflation rose to 0.6% in November, while core inflation stabilized at 0.8% year-on-year, in line with market's expectations. In the US, the ADP report showed that the private sector added 216K new employments in November, while the Chicago PMI for the same month jumped to 57.6 its highest level in almost two years. Also, Pending Home Sales in October inched modestly higher, up by 0.1% in the month, while personal income surged by 0.6%, boosted by higher employee compensation and interest on investments, although spending was less than expected, up by just 0.3% in the month.

The pair bounced from the mentioned low, holding far below the 1.0700 level, the 23.6% retracement of its latest daily decline. The pair has set a lower low for the week at the mentioned level, and the 4 hours chart shows that the price is developing not far below a directionless 20 SMA, while the RSI indicator heads lower around 45, but the Momentum turned higher within negative territory, this last indicating limited downward strength. Overall, the risk remains towards the downside, but it will take a break below the 1.0500/20 region to confirm a new leg lower during the upcoming sessions.

Support levels: 1.0550 1.0505 1.0460

Resistance levels: 1.0620 1.0660 1.0700

USD/JPY

The USD/JPY pair rallied up to 114.53, 2 pips shy of March high of 114.55, as the dollar advanced on stronger-than-expected employment figures, whilst US stocks advanced on the back of rising oil prices. Further supporting the pair were US bond yields that rose by the most since the US Presidential election, with the 30-year Treasury yield up to 3.04% and the 10-year note benchmark up to 2.38% by midday in New York. The pair heads into the Asian session above the 114.00 level, and the upward potential remains intact in the short term, given that in the 1 hour chart, technical indicators have partially corrected extreme overbought readings before resuming their advances, while the price skyrocketed above its 100 and 200 SMAs. In the 4 hours chart, technical indicators are losing upward strength, but holding near overbought territory, while moving averages have accelerated their advances below the current level. More relevant, the pair has broken above 114.00, the 23.6% retracement of the 2011/15 rally, and the bullish potential will persists as long as the price remains above it.

Support levels: 114.00 113.65 113.20

Resistance levels: 114.55 114.90 115.40

GBP/USD

The GBP/USD pair fell down to 1.2419 and quickly bounced to 1.2515 during the London morning, holding within the range set then for the rest of the day. The decline was triggered by the release of the BOE's banking stress test that showed that at least one bank, the Royal Bank of Scotland, will fail on a risk-increased scenario that contemplates contracting global economy and falling house prices. Barclays and Standard Chartered also failed to meet some of their minimum hurdles in the hypothetical scenario. The Pound found support in rising oil prices, but it was not enough to push the pair beyond the 1.2530, where selling interest is aligned. From a technical point of view, the pair maintains a neutral stance, although with a modest bullish bias, as in the 4 hours chart, the price is developing above its 20 SMA and its 200 EMA, both converging at 1.2460 and clearly reflecting the absence of a dominant trend, while the Momentum indicator heads north above its 100 level, at fresh two weeks highs, but the RSI indicator lost upward strength and heads modestly lower around 54. An upward extension beyond 1.2530 could see the pair rallying up to 1.2600, although further advances ahead of the US NFP report seem unlikely.

Support levels: 1.2460 1.2420 1.2385

Resistance levels: 1.2530 1.2565 1.2610

AUD/USD

The AUD/USD pair fell to a fresh weekly low of 0.7373 before bouncing modestly, meeting, however, short term selling interest around 0.7400 during the US session. The Australian was dragged lower at the beginning of the day by plunging Chinese iron-ore futures, down over 8% daily basis. The release of better-than-expected US data that supports an upcoming FED rate hike fueled the decline, albeit the pair pared losses on the back of stronger equities. From a technical point of view, the pair maintains a bearish stance, given that in the 1 hour chart the 20 SMA gained downward strength, now around 0.7450 while technical indicators stand in extreme oversold territory, having corrected modestly before turning back south. In the 4 hours chart, technical indicators have stalled their declines well into negative territory, whilst the 20 SMA turned lower well above the current level. A break below the mentioned daily low, could see the pair extending its decline down to the 0.7300 region, with scope to continue down to 0.7250, a major long term static support.

Support levels: 0.7370 0.7330 0.7290

Resistance levels: 0.7410 0.7450 0.7490

Dow Jones

US indexes closed the day mixed, with the Dow Jones Industrial Average up to a fresh intraday record high of 19,220, before settling at 19,123.58, barely 2 points up. The Nasdaq Composite and the S&P, however, closed in the red, with the first down 1.05% to 5,323.68 and the second shedding 0.27% to 2,198.81. Stocks opened with a strong footing and rallied at the beginning of the US session, fueled by OPEC's deal to cut oil production, but the positive sentiment faded as the day went by. Energy companies led gains after US crude oil added over 9% and closed the day at its highest in over a month. Nevertheless, all of the three major benchmarks ended the month with strong gains with the Dow posting its largest monthly gain since last March. From a technical point of view, the daily chart for the DJIA shows that technical indicators are slowly grinding higher after almost a week of consolidation within bullish territory, while the 20 DMA continued advanced below the current level, indicating that buying interest remains strong. In the 4 hours chart, the index maintains the neutral stance seen on previous updates, with the RSI indicator retreating from near overbought levels, currently heading lower around 56, but the Momentum indicator still unable to find direction, stuck around its 100 line.

Support levels: 19,105 19,066 19,010

Resistance levels: 19,180 19,220 19,255

FTSE 100

The FTSE 100 rallied on the back of oil gains, but trimmed most of its daily gains ahead of the close, and settled at 6,783.79, up by just 11 points this Wednesday. The index was weighed by loses in the banking sector following BOE's stress test, while mining-related shares also retreated sharply on falling Chinese metals' futures. Royal Bank of Scotland closed 1.37% lower after failing the test, while Fresnillo lost 2.76% and Randgold Resources 2.48% Royal Dutch Shell was among the best performers, up by 4.38%, followed by BP that added 1.59%. The daily chart for the Footsie shows that the intraday rallied up to its 100 DMA, retreating afterwards from the major resistance, while ending the day also below a bearish 20 DMA. Technical indicators in the mentioned time frame lost their bearish strength, but hold within bearish territory. In the 4 hours chart, the technical stance is bearish, with the index developing below bearish moving averages and technical indicators holding within bearish territory.

Support levels: 6,735 6,693 6,656

Resistance levels: 6,802 6,845 6,876

DAX

The German DAX closed the day 19 points higher at 10,640.30 with European equities advancing on hopes for an OPEC oil output deal. The deal was confirmed later on the day, although the Iranian oil Minister gave some hints during London trading hours. The energy sector led the way higher in the region, although among the DAX, BASF was the best performer, up by 3.08%, followed by Commerzbank that closed 2.29% higher and Deutsche Bank, which added 1.62%. The daily advance was not enough to erase the soft tone of the German benchmark, as in the daily chart, technical indicators continue hovering within neutral territory while the index is trading barely above its 20 DMA. Furthermore, the index retreated modestly in after-hours trading, and the 4 hours chart presents a modest bearish tone, with the 20 SMA capping the upside and technical indicators turning modestly lower, but also within neutral territory. Renewed selling interest below the 10,600 level will likely put the DAX back under selling pressure, with scope to test 10,538, this week low.

Support levels: 10,600 10,565 10,538

Resistance levels: 10,647 10,691 10,734

Nikkei

The Japanese benchmark, the Nikkei 225, closed the day flat at 18,308.48, adding just 1 point daily basis, as investors were in wait-and-see mode ahead of US employment data and the outcome of OPEC meeting. Asahi Glass was the best performer, up 3.77%, while JFE Holdings shed 4.33%, topping the losers' list. The benchmark, however, rallied up to 18,655 in futures trading, and enters the Asian session above 18,600, underpinned by a weakening yen that trades against the greenback around ¥114.00, the lowest for the Japanese currency since last March. The index stands at its highest since early January, and daily basis, technical readings support some further gains as the RSI accelerated higher within overbought territory, while the Momentum indicator posted a modest advance within positive territory. In the 4 hours chart and for the shorter term, the risk is also towards the upside, as the index has advanced further above its 20 SMA, while technical indicators have turned flat near overbought territory, rather reflecting the low volumes at this time of the day than suggesting that buying interest is exhausted.

Support levels: 18,545 18,487 18,422

Resistance levels: 18,655 18,715 18,760

Gold

Spot gold extended its decline to a fresh 9-month low of 1,170.53, ending the day at $1,174.50 a troy ounce as risk appetite re-surged on the back of an OPEC output production deal. The safe-haven metal was also weighed by dollar's strength following another round of positive US data that fueled expectations of an interest-rate hike by the US FED in their December meeting. Daily basis, the bearish momentum remains strong, as the Momentum indicator has resumed his decline within bearish territory, while the RSI indicator also turned lower around 25. In the same chart, the 20 DMA has extended its slide, now offering a strong dynamic resistance in the 1,215.40 price zone. In the 4 hours chart, the price extended below a still flat 20 SMA, while technical indicators have lost their bearish strength, but hold within negative territory, maintaining the risk towards the downside.

Support levels: 1,170.50 1,161.65 1,152.90

Resistance levels: 1,186.80 1,197.55 1,215.40

WTI Crude Oil

Oil prices jumped over 9% this Wednesday to their highest levels in five weeks, as the OPEC managed to put on a deal to cap oil production, to 32.5 million barrels per day, from a current 33.64 million bpd. Also, Russia has agreed to cut output by 300,000 bpd. OPEC's members will meet with non-OPEC producers next December 9th. West Texas Intermediate oil futures traded as high as $49.88 a barrel before retreating some cents to the 49.50 region, and the daily chart presents a strong upward momentum within bullish territory, while the price has largely extended beyond its moving averages, while also breaking above the 61.8% retracement of its latest daily slump, the immediate support at 48.65. In the shorter term and according to the 4 hours chart, the commodity is also biased higher, with technical indicators maintaining their strong upward slopes, despite being in overbought territory, while the price has rallied above all of its moving averages.

Support levels: 48.65 47.90 47.20

Resistance levels: 49.90 50.60 51.20