Risk appetite dominated financial boards this Thursday

EUR/USD

Risk appetite dominated financial boards this Thursday, as investors rushed to price in a Bremain, in the UK's referendum on whether they should remain or not within the EU. Wall Street's opening, however, poured some cold water over sentiment, with majors paring gains and even correcting lower. Nevertheless, high yielders soared, while the dollar and the yen sunk, amid  their safe-haven condition. Market is now waiting for the final result, expected to be out around mid-night in the UK, roughly two hours after the polls close, which means most market action would take place during Asian trading hours, although a strong market reaction is also expected with London's opening this Friday.

The EUR/USD pair surged up to 1.1421, the highest in over a month, but retreated back to end the day around  the 1.1360 level, the 50% retracement of the May's decline. The pair maintains a modest positive tone from a technical point of view, as in the 4 hours chart, the price is well above its moving averages, whilst the technical indicators bounced within positive territory, and maintain bullish slopes. Nevertheless, the upcoming moves will be solely related to the UK poll outcome, although a positive result seems to be already priced in. An advance beyond the mentioned daily high can see the pair extending up to 1.1460 a major long term resistance level, while the above this last the rally can extend up to the 1.1500 region, although gains beyond this last are not yet likely. A negative surprise on the other hand, can see the pair returning to the lower end of this week's range around 1.1200.

Support levels: 1.1320 1.1280 1.1240

Resistance levels: 1.1420 1.1460 1.1500

USD/JPY

The Japanese yen sunk against all of its major rivals, with the USD/JPY pair reaching a weekly high of 106.03, now trading some 20 pips below the level ahead of the outcome of the UK poll that has kept investors on their toes ever since the month started. The pair is now trading above the 23.6% retracement of its latest daily fall, and a positive tone prevails in the short term, although a more sustainable recovery is not in the cards at this point,   as there are no reasons for a dollar rally after the FED not only maintained its economic policy unchanged, but somehow, anticipated it will remain so for longer than expected. Technically, the 1 hour chart shows that the pair has entered a consolidative stage, above the 105.50 region, the immediate support. In the same chart, the technical indicators are turning modestly lower within overbought levels, whilst the price is well above its moving averages. In the 4 hours chart, the recovery stalled a few pips below a strongly bearish 100 SMA, now around 106.15, whilst the technical indicators have lost directional strength, but remain well above their mid-lines. The recovery can extend up to 107.50, the 50% retracement of the mentioned decline, but after the dust settles, and despite a positive outcome, the pair may resume its longer term decline.

Support levels: 105.50 105.10 104.70

Resistance levels: 106.15 106.60 107.00

GBP/USD

The GBP/USD pair surged to a fresh yearly high of 1.4946 after London's opening, underpinned by market's optimism, after a UK betting agency said that odds of a Bremain were at 84%. The British Pound advanced against all of its major rivals, having advanced over 900 pips against the greenback in a bit less than two weeks,  from the bottom at 1.4012 set last June 16th. After testing the mentioned high, the pair began retracing, but maintained the positive tone all through the day. Now standing above the 1.4800 level ahead of the results, the 4 hours chart shows that buying interest has surged on approaches to a strongly bullish 20 SMA, whilst the technical indicators have turned flat within positive territory, supporting some further advances for this Friday. A  positive result can see the pair surging back, up to the 1.5000 figure, although at this point, seems most of such outcome has been priced in. In the case of a Brexit, the pair will likely plummet towards 1.4500 and below, with the decline then set to extend into next week. 

Support levels: 1.4800 1.4760 1.4720

Resistance levels: 1.4870 1.4915 1.4950

AUD/USD

The AUD/USD pair advanced up to 0.7602, a fresh 7-week high, paring gains around a major Fibonacci resistance, as the figure stands for the 23.6% retracement of this year's rally.  The Aussie found support not only on risk appetite, but was also underpinned by a modest advance in commodities' prices. Additionally, the fact that the RBA is in no rush to cut rates, whilst a near term hike in the US seems unlikely, points for further gains in the pair, once the Brexit madness comes to an end. Short term, the pair has reached overbought conditions, with technical indicators in the 1 and 4 hours chart now consolidating within extreme levels, none of them suggesting the pair may retreat during the upcoming hours. The pair can extend its rally during the upcoming hours, and later retreat on profit taking ahead of the weekend, but the dominant trend is now bullish, and retracements should be read as buying opportunities.

Support levels: 0.7570 0.7535 0.7500

Resistance levels: 0.7610 0.7660 0.7700

Dow Jones

After spending most of the day in the green, Wall Street soared in the last trading hour, resulting in the DJIA settling above the 18,000 level for the first time in over two weeks. The upward momentum in US equities was backed by markets' positive mood, amid hopes the UK referendum will end up with a "remain" victory. The DJIA closed the day up 230 points or 1.29%, at 18,011.07, while the Nasdaq added 1.59%, to end at 4,910.04. The S&P added 1.34% and closed at 2,113.32. Holding near its high, the daily chart for the DJIA shows that the index has advanced beyond a still horizontal 20 SMA, whilst the Momentum indicator remains flat around its 100 level, but the RSI indicator heads north around 61, supporting some further gains ahead. In the 4 hours chart, technical indicators head sharply higher within bullish territory, whilst the 20 SMA has extended above the 100 and 200 SMAs and maintains a strong upward slope far below the current level, all of which maintains the risk towards the upside.

Support levels: 17,972 17,918 17,841

Resistance levels: 18,051 18,103 18,165

FTSE 100

The FTSE 100 extended its rally for a fifth consecutive day, adding 1.23% or 77 points this Thursday, to close the day at 6,338.10 its highest close in two months. The index was supported by increasing hopes that the UK will remain within the EU, after a couple of polls showed that the "remain" intention vote led. Across all Europe, the banking sector gained the most, with local HSBC up 2.35% and Standard Chartered adding 2.03%. Also up was Tesco, as the supermarket reported a 0.9% rise in same-store sales during the first quarter of the fiscal year. The daily chart shows that the index has managed to post a  higher high and a higher low, whilst the technical indicators keep heading higher within positive territory, maintaining the risk towards the upside, at least from a technical point of view. In the 4 hours chart, the 20 SMA has advanced beyond the 100 and 200 SMAs below the current level, whilst the technical indicators also head north within positive territory, in line with the longer term perspective.

Support levels: 6,324 6,260 6210

Resistance levels: 6,388 6,440 6,490

DAX

The German DAX surged strongly, adding 189 points this Thursday to close the day at 10,257.03. All European indexes closed with solid gains on expectations the UK referendum will keep the kingdom within the Euro union. All sectors edged higher, with banks leading the advance, as Commerzbank closed up by 4.97 and Deutsche added 4.36%. Volkswagen advanced 3.41% whilst RWE, an electricity and natural gas provider ended the day up by 3.06%. The index rallied further after the close, and stands now above 10,300 its highest for  this month. Daily basis, the benchmark presents a nice bullish tone, as the technical indicators maintain strong upward slopes after crossing above their mid-lines, whilst the index advanced well above its 200 DMA. In the 4 hours chart, the technical indicators resumed their advances after a limited downward correction for overbought levels, whilst the 20 SMA turned strongly higher far above the current level, and is about to cross above the 100 and 200 SMAs, all of which supports additional gains for the upcoming sessions.

Support levels: 10,253 10,176 10,095

Resistance levels: 10,375 10,435 10,491

Nikkei

Asian equities ended mixed, although the Japanese Nikkei surged by 174 points or 1.07% to close the day  at 16,238.35, as optimism over the UK referendum outcome prompted yen's selling, resulting in export-oriented shares gaining strongly. Automakers and electronic makers lead the advance, with Sharp Corp, up by 6.4% and Mazda motor surging 4.39% being among the biggest winners. The benchmark advanced further in electronic trading, tracking Wall Street's advance, and is now hovering around 16,545 ahead of a new daily opening. Daily basis, technical readings support additional advances, as indicators are crossing their mid-lines towards the upside with strong upward slopes, as the benchmark is now aiming to advance beyond the 100 DMA having already took out the 20 DMA. In the 4 hours chart, has rallied well above a bullish 20 SMA, whilst the technical indicators aim higher within bullish territory, supporting some further advances for the upcoming session.

Support levels: 16,435 16,350 1,280

Resistance levels: 16,692 16,755 16,852

Gold

Gold prices spent most of this Thursday consolidating, with spot ending the day pretty much flat, around $1,261.90 a troy ounce. The bright metal drifted lower at the beginning of the day, extending its decline down to 1,257.45 a fresh 2-week low, but bounced back as the dollar was broadly weaker. In EUR and GBP terms, however, gold prices ended sharply lower down over 10% against the Pound from the three-year high set last week at  £938, amid increasing speculation the UK will remain within the Euro region.  From a technical point of view, the downward risk persists, but looks now limited, as the technical indicators have lost their bearish momentum and turned horizontal above their mid-lines, whilst the price stands a few cents below its 20 SMA. In the 4 hours chart, the 20 SMA heads south above the current level, capping the upside now around 1,271.40, whilst the technical indicators lack clear directional strength, but hold near oversold levels, supporting some further slides on a break below the daily low, and with scope to extend down to the 1,242.50 region, should risk appetite persist.

Support levels: 1,257.45 1,248.80 1,242.50

Resistance levels: 1,269.90 1,278.80 1,290.70

WTI Crude Oil

Crude oil prices surged ahead of Wall Street's close, with US light, sweet crude a couple of cents above $50.00 a barrel. A report from Genscape, showing a draw-down of nearly 1 million barrels at the Cushing, Oklahoma base for the week ended June 17th, helped the commodity to recover ground that anyway held within Wednesday's range. Additionally, Brexit jitters have kept the greenback under pressure ever since the day started. Despite the intraday recovery, the commodity maintains the neutral tone in the daily chart, with the price now slightly above a horizontal 20 SMA and the technical indicators still stuck around their mid-lines. In the shorter term, however, the upside is favored as in the 4 hours chart, the technical indicators head modestly higher above their mid-lines, whilst the price is currently above its moving averages. An advance beyond 50.50, this week high, is now required to confirm additional advances towards 51.64, June high, for this Friday.

Support levels: 49.20 48.40 47.60

Resistance levels: 50.50 51.10 51.65