The American dollar started the day on the back foot

EUR/USD

The American dollar started the day on the back foot, undermined by the earthquake and the following tsunami alert that hit Japan at the beginning of the Asian session, although fortunately, markets' fears eased on news that there were no major damages in the nuclear central region. In the news, US elected President, Donald Trump, has outlined his plans for his first 100 days in office, and announced that he intends to withdraw the US from the Trans-Pacific Partnership deal,  but strong housing data and a rally in US stocks to fresh record highs, neutralized any possible negative effect the announcement may have had. The EUR/USD pair advanced up to 1.0657 during the London session, but was unable to hold on to gains, and finished the day a handful of pips above the 1.0600 figure. 

The macroeconomic calendar has been quite light so far this week, although the US released its October Existing Home Sales figures, showing that sales rose for a second consecutive month, up by 2.0%,  the highest annualized pace in nearly a decade, according to official data. This Wednesday, attention will focus on preliminary PMIs in Europe, and Durable Goods order in the US. 

Technically, the pair is in a consolidative stage, and still at risk of breaking lower, given that in  the 4 hours chart, the price is hovering around a bearish 20 SMA, while the 100 and 200 SMAs maintain their sharp bearish slopes well above the current level, and technical indicators aim modestly higher, but with no actual upward strength. Overall, the corrective movement can indeed extend up to the 1.0800 region, but unless the pair settles above 1.0840/60, the risk will remain towards the downside. A Break below 1.0590 on the other hand, should open doors for a bearish extension towards the 1.0505/20 region.

Support levels: 1.0590 1.0560 1.0510 

Resistance levels: 1.0650 1.0690 1.0720 

USD/JPY

The USD/JPY pair fell down to 110.26 during the past Asian session, with the yen on demand amid fears over the consequences of the earthquake suffered by Japan at the beginning of the day, but as fears eased, the pair recovered ground, surging up to 111.35 on renewed dollar's strength in the US session. Better-than-expected US housing and manufacturing data, helped the greenback to resume its advance, while a sharp rally in Wall Street, with major indexes reaching all-time highs, underpinned the pair's recovery. The pair remains extremely overbought according to daily technical readings, with the RSI heading modestly higher around 80 in the daily chart, but at this point, there are no signs that the pair may change course. In the short term, the 1 hour chart shows that the pair is clearly in a consolidative phase, but above a bullish 100 SMA that currently offers an immediate short term support at  110.25, while technical indicators have bounced from their mid-lines, but lack enough upward strength to confirm a bullish breakout. In the 4 hours chart, technical indicators have turned lower within positive territory, while the 100 SMA has extended its advance far below the current level, converging now with a major Fibonacci level around 106.60. A break above 111.44, May's monthly high, is now required to confirm a bullish extension that can extend up to the 114.00 region. 

Support levels: 110.60 110.25 109.80

Resistance levels: 111.45 111.90 112.30

GBP/USD

Following a strong rally on Monday, the Pound stabilized within a 50 pips range against the greenback, right below the 1.2500 mark. The softer tone in Theresa May's approach to Brexit, indeed helped the Sterling, although the positive mood was quickly reversed on Tuesday, after Guy Verhofstadt, the chief Brexit negotiator for the European Union's parliament,  said  that the UK must be completely severed from the EU before the next European Parliament elections, which take place in May 2019, leaving a 14-15 months´ window for Brexit negotiations. The GBP/USD pair fell through the 1.2400 figure late in the American afternoon, weighed also by strong US data that triggered renewed demand for the US currency. From a technical point of view, the pair presents a neutral stance intraday, as in the 4 hours chart, the price is holding above a horizontal 20 SMA, while the Momentum indicator has bounced from its 100 level, and heads north, opposing to the RSI indicator that turned south and is currently around 48. The pair seems to have found a new comfort zone within 1.2300 and 1.2600, with the longer term risk still towards the downside amid Brexit woes.

Support levels: 1.2395 1.2350 1.2310

Resistance levels: 1.2440 1.2485 1.2520

AUD/USD

The AUD/USD pair advanced up to 0.7413 this Monday, helped by optimistic comments from RBA's Assistant Governor Kent, speaking in Sydney. According to his words, mining states' prospects are improving as the drag on economic growth eases, and will likely boost inflation "to more normal levels." The pair retreated from the mentioned high, on the back of a stronger dollar during US trading hours, but met intraday buying interest around 0.7370, now the immediate short term support, and closed higher for a second consecutive day. In the 1 hour chart, the price is struggling around a bullish 20 SMA, while technical indicators head modestly lower around their mid-lines, limiting chances of an upward move during the upcoming hours. In the 4 hours chart, however, technical indicators head north within positive territory, while the price has recovered after testing a bearish 20 SMA that stands below the current level. While a bottom has not been confirmed, the mixed readings suggest some consolidation ahead, with chances of an upward corrective movement up to 0.7450, the 38.2% retracement of this year's early rally. 

Support levels: 0.7370 0.7330 0.7290 

Resistance levels: 0.7420 0.7450 0.7500 

Dow Jones

The Dow Jones Industrial Average hit a new milestone this Tuesday, rising past 19,000 for the first time ever, settling at 19,023.87, up by 67 points or 0.35%. The S&P closed at 2,202.94, up by 0.22% and above the 2,200 mark for the first time on record, while the Nasdaq Composite advanced 0.33% to 5,386.35. The Dow is over 1,500 points above its monthly low of 17,475, level reached after the announcement that Donald Trump won the US presidential election. Against all odds, stocks ramped up on the unexpected result, on speculation the 45th US president will give a strong boost to economy, with tax cuts and infrastructure investment. Technically, the daily chart shows that the index continues advancing well above its moving averages, while the Momentum indicator has partially lost its upward strength within overbought territory, but the RSI indicator keeps heading north, despite being around 76. In the 4 hours chart, the 20 SMA has turned modestly higher below the current level, while the Momentum indicator remains flat above its 100 level, and the RSI indicator resumed its advance around 69, supporting some additional gains for this Wednesday. 

Support levels: 19,014 18,952 18,905    

Resistance levels: 19,045 19,100 19,150 

FTSE 100

The FTSE 100 advanced 0.62% or 41 points, to close at 6,819.72, underpinned by a fall in the Pound, although investors maintained a cautious stance ahead of the Autumn Forecast Statement, to be released by the UK government this Wednesday. The commodity-related bloc led the advance, with Anglo American closing the day up 7.62%, followed by Glencore  that added 5.33% and BHP Billiton adding 4.92%. The daily chart for the Footsie shows that the benchmark is now struggling with its 20 and 100 SMAs, both converging around 6,830, while technical indicators have extended their advance within bearish territory, now aiming to cross their mid-lines. In the shorter term, the 4 hours chart the index is above a modestly bullish 20 SMA, while technical indicators are from neutral-to-bearish within positive territory, while the 100 SMA continues heading south above the current level, maintaining the upward potential limited. 

Support levels: 6,822 6,772 6,734

Resistance levels: 6,876 6,925 6,970

DAX

The German DAX closed the day marginally higher at 10,713.85, up by 28 points or 0.37%. European equities gapped higher at the opening, but trimmed most of their daily gains ahead of the close. Nevertheless, a strong rally in mining and insurance-related equities, kept major benchmarks in the green. Among the DAX, diversified industrial company ThyssenKrupp was the best performer, up by 2.49%, followed by Deutsche Telekom that added 1.67%. Fresenius, on the other hand, lead losers, shedding 1.53%. The German index flirted with the top of its latest range, and is biased higher according to the daily chart, given that technical indicators have finally accelerated above their mid-lines, entering the Asian session with strong upward slopes. In the same chart, the 20 DMA remains flat below the current level, around 10,605, a line in the sand for bulls. In the 4 hours chart,  the index maintains the neutral stance seen on previous updates with technical indicators consolidating within positive territory and the index developing above horizontal moving averages. 

Support levels: 10,702 10,648 10,603    

Resistance levels: 10,786 10,834 10,890

Nikkei

The Nikkei 225 managed to shrug off early losses and closed the day 56 points higher at 18,162.94, on limited damage from the early earthquake. The benchmark also found support in continued yen's weakness, as the USD/JPY pair held around the ¥111.00 level. The index inched higher in after-hours trading, backed by Wall Street's gains, and is poised to open the day above the 18,200 level. From a technical point of view, the daily chart shows that the Momentum indicator turned modestly lower near overbought levels, but that the RSI indicator keeps heading north around 73, while the 20 DMA has extended its advance below the current level, all of which favors some further gains ahead. In the 4 hours chart, a bullish 20 SMA continues to attract buyers on pullbacks, currently at 18,078, while technical indicators hold within positive territory, although lacking directional strength. 

Support levels: 18,157 18,078 18,020

Resistance levels: 18,232 18,271 18,340

Gold

Spot gold rallied up to $1,221.00 a troy this Tuesday, as the dollar maintained the soft tone during the first half of the day, but ended the day lower, settling around 1,212.20 by the end of the US session. The early rally was supported by physical buying in Southeast Asia on bargain-hunting, as the price has approached production cost, with limited downward scope in the longer run, in spite of dollar's strength. The daily chart for the bright metal shows that technical indicators have corrected modestly from extreme oversold readings, but also that the RSI indicator has turned back south around 30, whilst the 20 SMA has sharpened its decline far above the current level, all of which maintains the risk towards the downside. In the 4 hours chart, the price has advanced briefly above a bearish 20 SMA, now struggling around it, while the Momentum indicator hovers directionless around its 100 level and the RSI indicator holds around 44, in line with the longer term perspective, and still favoring a bearish extension on a break below 1,198.20 the immediate support. 

Support levels: 1,198.20 1,190.90 1,182.50    

Resistance levels: 1,217.60 1,226.75 1,233.05 

WTI Crude Oil

West Texas Intermediate crude oil futures rallied up to $49.18 early Tuesday, its highest since October 28th, but turned south on OPEC's output cut deal headlines, which raised doubts about a positive outcome. OPEC committee was willing to announce some sort of deal this Tuesday, but ended up announcing that will defer the issue of Iran and Iraq to November 30th. Pretty much, they are announcing that those particular producers are not willing to cut oil production at the time being. The US benchmark fell down to 47.15 with the news, but ended the day marginally lower around $48.50, on some late headlines saying that the OPEC  has finished its work "successfully." Technically the daily chart shows that commodity is a few cents below the 61.8% retracement of its latest weekly decline at  48.65, having held well above its moving averages, and with technical indicators having lost their upward momentum within positive territory, not enough to confirm a new leg lower. In the 4 hours chart, the price has bounced sharply from a bullish 20 SMA, while technical indicators have resumed their advances within overbought territory, maintaining the risk towards the upside. Still, oil will likely remain sensitive to OPEC´s news, which will set the trend  for the commodity. 

Support levels: 47.70 47.10 46.50    

Resistance levels: 48.65 49.20 49.95