The EUR/USD pair resumed its slide after Monday's upward correction

EUR/USD

The EUR/USD pair resumed its slide after Monday's upward correction, declining to a fresh 14-year low of 1.0352, ending the day a few pips below the 1.0400 mark. There were little macroeconomic developments in Europe and the US to guide the pair, with the greenback getting a boost at the beginning of the day from the Bank of Japan, as an optimistic Kuroda left the monetary policy unchanged. In Germany the PPI posted its first positive annual rate change since June 2013, up by 0.1% in November, whilst the EU current account for October recorded a surplus of €28.4 billion from an upwardly revised €27.7 billion in September. There were no relevant news released in the  US. 

Technically,  the pair is poised to  extend its decline and to close the day a few pips below the 1.0400 level, despite volume is likely to shrink further during the upcoming days amid winter holidays. Short term, the bearish momentum has eased, given that the 20 SMA has lost its downward strength, turning flat around 1.0420, whilst the Momentum indicator aims modestly higher within negative territory and the RSI indicator posted a tepid bounce from oversold readings, now at 35, indicating the absence of buying interest, with the intraday recovery rather due to some profit taking. The daily low was set at 1.0352, with a downward extension expected to extend towards the 1.0300 region this Wednesday. 

Support levels: 1.0350 1.0320 1.0280

Resistance levels: 1.0480 1.0520 1.0560

USD/JPY

The USD/JPY pair recovered the ground lost on Monday, during the past Asian session, following the latest BOJ's monetary policy decision. The Bank of Japan stayed pat, keeping rates unchanged at record lows -0.10%, with Kuroda offering a much more optimistic outlook after the yen depreciated over 15% sin bottoming around ¥100.00 earlier this year. Kuroda also vowed to keep the ongoing loose monetary policy until the 2% inflation goal is achieved. Real GDP was revised from 1.2% to 1.5% for the next fiscal year, whilst nominal growth is now expected to increase to 2.5% from previous estimate of 2.2%.  Additionally, he expressed no concerns over latest yen´s directional move, saying that he doesn't think the yen has weakened excessively at this stage. The pair advanced up to 118.23 intraday, but is still having trouble to sustain gains beyond the 118.00 figure, and the short term picture suggests that the pair may ease during the upcoming Asian session, as in the 1 hour chart, the price is back resting over a bullish 100 SMA, at 117.60, the immediate support, while technical indicators keep heading lower within positive territory, suggesting a break below the mentioned SMA will result in additional declines. In the 4 hours chart, the Momentum indicator retreats after failing to enter positive territory, whilst the RSI indicator heads south around 57, in line with the shorter term outlook. 

Support levels: 117.60 117.15 116.80

Resistance levels: 118.30 118.65 119.00

GBP/USD

The GBP/USD pair recovered from a fresh monthly low of 1.2312, as the dollar eased in the American afternoon. Also favoring the British currency were comments from BOE's MPC member Ian McCafferty , who said that there are limits to how much of an overshoot of inflation the Bank would tolerate and that the next policy move could  be either a tightening or an easing. Earlier on the day the UK CBI survey surprised to the upside, with retailers confident on this December developments, up to 35% from 26% in November and well above the 20% consensus. The strong reading adds to recent indicators of the UK economy resilience to Brexit's woes. Still, the pair has faltered on attempts to regain the 1.2400 figure at the beginning of the day, as it faltered early Monday to recover the 1.2500 level before shedding over 150 pips, indicating that the GBP/USD pair is at risk of easing further towards the 1.2000/1.2100 region, should the mentioned 1.2330 strong static support gives up. In the 4 hours chart, the 20 SMA has partially lost its bearish strength, but remains well above the current level, around 1.2420, whilst the Momentum indicator has turned flat within negative territory and the RSI indicator consolidates around 32, indicating the absence of buying interest around the Pound. 

Support levels:  1.2330 1.2290 1.2250 

Resistance levels: 1.2385 1.2420 1.2460  

AUD/USD

The AUD/USD recovered from a fresh 6-month low of 0.7222 to close the day marginally higher around 0.7260. At the beginning of the day, the Minutes of the latest RBA meeting gave the Aussie a mild boost, as the Central Bank hinted that it's content to leave rates steady at the time being, although it warned about the already "high levels" of household debt, as a consequence of lower interest rates boosting borrowing. A brief spike above 0.7300 was quickie reversed on dollar's strength, but as seems usually these days, investors rushed to take some profits out of the table ahead of the US close, with the Aussie also benefiting from a rally in US stocks.  Despite closing in the green the pair has settle a lower low and a lower high daily basis, which maintains the risk towards the downside, making of this intraday bounce a mere correction. Short term, the 1 hour chart the price is a few pips above a still bearish 20 SSMA, whilst technical indicators have turned flat within neutral territory. In the 4 hours chart, the price remains well below a bearish 20 SMA around the 0.7290 mark, while technical indicators have corrected oversold conditions and head north, but still remain below their mid-lines, indicating limited buying interest around the pair. 

Support: levels: 0.7210 0.7175 0.7140

Resistance levels: 0.7290 0.7330 0.7370

Dow Jones

Wall Street advanced this Tuesday, with the Dow Jones Industrial Average adding 91 points or 0.46, to close at 19,974.62, a new record high. The Nasdaq Composite advanced 0.49% and closed at 5,483.94, also an all-time high, whilst the S&P gained 8 points, to 2,270.76. Among the DJIA, Nike was the best performer, up by 1.85%, followed by Caterpillar that gained 1.76%, although the banking sector also performed well, with Goldman Sachs up 1.68% and JPMorgan Chase adding 1.29%. Having pared gains just shy of the 20,000 threshold, the Dow maintains its bullish tone according to the daily chart, as the Momentum indicator turned north, standing at fresh monthly highs, whilst the RSI also aims higher around 79, with no signs of upward exhaustion, despite extreme overbought readings. In the 4 hours chart, the index is neutral-to-bullish, having advanced modestly above its 20 SMA and with technical indicators grinding higher within neutral territory and with no actual strength.

Support levels: 19,894 19,823 19,746    

Resistance levels: 19,984 20,040 20,100

FTSE 100

The FTSE 100 advanced to a fresh 2-month high, helped by a weaker Pound, adding 26 points on the day to close at 7,043.96. Following a tepid start of the day, equities changed course mid London morning, with travel-related equities under pressure after a terrorist attack in Germany and the shooting of Russian ambassador in Turkey. The banking sector was again the best performer, with Barclays up 2.52%, Lloyds Banking Group adding 2.22% and Royal Bank of Scotland adding 1.43%. Miners closed mixed, with Glencore up 1.58% but Fresnillo shedding 2.06%. The daily chart shows that the upward momentum persists early Asia, as technical indicators extended their advances within positive territory, maintaining their bullish slopes, whilst the index moved further above the 20 and 100 DMAs, both converging around 6,872. In the 4 hours chart, the Momentum indicator diverges lower within positive territory, not enough to confirm a downward short-term move ahead, while the RSI indicator continues consolidating around 65. 

Support levels: 7,000 6,960 6,926 

Resistance levels: 7,054 7,080 7,136

DAX

European equities extended their advance this Tuesday, with the German DAX  recording a fresh yearly high after advancing 38 points to settle at 11,463.74. Financial stocks and energy-related equities lead the way higher in the region, while an upward surprise in German's November PPI fueled the benchmark.  Deutsche Bank jumped by 4.07%, the best performer of the day, with Commerzbank closing 2.13%, and only 5 out of the 30 components closing in the red. Trading at levels last seen in August 2015, technical indicators in the daily chart have turned modestly higher after a period of consolidation within overbought readings, whilst the index remains far above its moving averages, indicating further gains ahead. In the 4 hours chart, a bullish 20 SMA continues leading the way higher, acting as dynamic support, now around 11,373, whilst technical indicators continue to lack directional strength, due to limited intraday ranges, but hold within positive territory, in line with the longer term perspective. 

Support levels: 11,428 11,373 11,338

Resistance levels: 11,475 11,520 11,566

Nikkei

The Nikkei 225 resumed its advance, adding 103 points or 0.53% this Tuesday to close the day at 19,494.53, a fresh 2016 high, underpinned by BOJ's upgrade of its economic forecasts, remarking that the Central Bank will maintain its expansionary policy until inflation recovers above 2% "in a stable manner." Export-oriented equities were among the best performers, with auto makers and technology firms leading the way. The benchmark advanced further in after-hours trading, tracking Wall Street's gains, poised now to open the day around 19,560, and bullish according to technical readings in the daily chart, as indicators have accelerated further higher within overbought readings, whilst the 20 DMA continued advancing below the current level. In the 4 hours chart, the index is above a modestly bullish 20 SMA, currently at 19,430, while technical indicators have lost upward strength but hold within positive territory, maintaining the downside limited. 

Support levels: 19,502 19,430 19,362 

Resistance levels: 19,591 19,647 19,700

Gold

Spot gold erased its early week gains, falling as low as $1,125.72 a troy ounce, as the dollar resumed its advance against most of its major rivals. Spot settled at a few cents above 1,131.00, back in negative territory weekly basis. The bright metal remain on the defensive ever since the US election early November, further weighed by expectations of a FED's faster pace of tightening during the upcoming 2017. Holding above 1,122.60, the 10-month low posted last week, the daily chart shows that the bearish trend remains strong, as the RSI indicator resumed its slide after a modest upward correction within oversold territory, while the Momentum indicator has also resumed its slide well below its mid-line. Furthermore, the 20 DMA has accelerated its decline above the current level, now standing at 1,160.90. In the 4 hours chart, the price is holding below a modestly bearish 20 SMA, whilst the Momentum indicator moves back and forth around its mid-line, and the RSI is barely bouncing from oversold readings, rather reflecting the intraday bounce than suggesting an upward extension for the upcoming hours. 

Support levels: 1,122.60 1,114.80 1,094.30    

Resistance levels: 1,142.50 1,151.20 1,164.05

WTI Crude Oil

West Texas Intermediate crude oil futures set a higher intraday range this Tuesday, posting a higher low and a higher high daily basis, but ending its second consecutive day unchanged around $53.20 a barrel. Crude was able to resists dollar's strength, on the back of hopes of a sharp drawdown in US stockpiles, to be released this Wednesday. Markets are expecting the EIA report to show a draw of 2.4 million barrels in the week ending Dec. 16, as a colder weather in the US have probably boosted demand for heating oil. In the daily chart, a strongly bullish 20 DMA advanced further below the current level, now around 51.40, while the Momentum indicator has turned flat above its 100 level after correcting overbought conditions, and the RSI holds flat around 61, all of which maintains the risk towards the upside. In the shorter term, and according to the 4 hours chart, the commodity is neutral-to-bullish, as the price held above a modestly bullish 20 SMA, whilst technical indicators retreated within positive territory, showing no certain directional strength.

Support levels: 52.55 51.40 50.90

Resistance levels: 53.70 54.20 54.95