The following article was written by ATFX Chief Analyst of Asia Pacific, Martin Lam.
Personal opinions today:
Martin Lam, ATFX
In the Asian trading session this morning, the foreign exchange market extended the performance of the US market closed last week. The US dollar index continued to slump, the euro performance continued to be above at 1.14, and the British pound maintained at 1.27. Gold and crude oil prices were still flat on the market. Gold was above $1,278, while US crude oil was tested at $46. The update market news shows China and the United States government will agree to meet on January 9 next week. The Chinese government actively cooperates with the details of trade negotiations. It is expected that the Sino-US trade war will be cool down, to avoid the uncertainty of US tariffs and the uncertain development of investment.
On the first day of 2019, international transactions entered normal operation, as long as the holidays in Japan and Korea were closed, but it is believed that it did not affect the trading of the European trading market in the afternoon. The focus of the market will looking at the US job market report this week. Due to the suspension of some departments of the US government, it is estimated that the US ADP job data in December and the number of initial jobless claims last week may be poor. The market is also concerned that the expected figures will be negative for the US dollar. Gold prices continue to be supported in the short-term bullish European and Asia Pacific currencies. In terms of oil prices, the US crude oil price will likely test for 47 US dollars, but the oil price can continue to rise. It may be believe it is necessary to wait for the US APl crude oil inventory report on Friday morning. If it will see a significant reduction, thus boosting the overall oil price.
Today’s suggestion:
EURUSD
1.1465/1.1480 resistance
1.1425/1.1410 support
Although the dollar exchange rate performance is weakly developed, it is bullish for the euro. However, the market is still concerned about the performance of the Eurozone data. The overall forecast is that the Euro will remain within the range of 1.14 to 1.1480 in the short term. If the US job market report disappoints the market this week, the dollar will fall again, and the euro-dollar exchange rate is expected to rise, challenging the 1.15 level.
GBPUSD
1.2785/1.2810 resistance
1.2705/1.2690 support
The market continues to pay attention to the risk of Brexit. The UK government and the Prime Minister must announce the overall Brexit plan this month. It is imperative to arrange a Brexit plan in March to avoid economic damage. Otherwise, the UK government will be responsible for all risks after Brexit problem. Therefore, the pound will continue to be under pressure in the short term. Technically, the trend is still bearish for the pound, and the 1.28 level will be the key to the resistance. If there are any problems that affect the investment in UK assets, the pound will have the opportunity to test the 1.25 level.
USDCHF
0.9820/0.9805 support
0.9875/0.9890 resistance
The U.S. government has not yet passed the issue of budget funds, which is bad for the US dollar, indirectly for the European currency, and indirectly for the Swiss franc. Technically, the Swiss Franc continues to follow the pace and direction of the Euro. However, the euro did not break above 1.15 against the dollar, and the dollar is expected to stop at 0.9800 support against the Swiss franc.
USD/JPY
109.75/110.00 resistance
109.30/109.15 support
Although this week’s US job market report made the market think that the US dollar is not optimistic, and the US government has not yet passed the budget fund issue, it is bad for the US dollar. However, the Sino-US trade war has eased and made progress, and has the opportunity to boost the US Dow and the Asia-Pacific stock market. If the stock market rises, it will help the dollar to rise against the yen. It is recommended to pay close attention to the USD/JPY as the performance of the stock market has changed.
AUDUSD
0.7000/0.6975 support
0.7075/0.7090 resistance
This morning, China’s manufacturing purchasing managers index recorded a contraction, only 49.7, affecting the performance of the Australian dollar. However, it is expected that the Sino-US trade war will resume negotiations, and the two sides will make progress. On the one hand, it is expected to improve trade relations, on the other hand, it will improve the development of international trade cooperation and drive the growth of Australia’s economy. If the fundamentals improve, it will help the Australian dollar against the US dollar. Technically, if the Australian dollar rises against the US dollar, the first target can focus on 0.7090 resistance.
NZDUSD
0.6680/0.6660 support
0.6745/0.6760 resistance
This morning, China’s manufacturing purchasing managers index recorded a contraction, only 49.7, affecting the performance of the New Zealand dollar. However, the Sino-US trade war is easing, and China and the United States plan to restart the meeting next week. The current relationship between the two sides is positive performs support the New Zealand dollar. At present, the New Zealand dollar performance is weak. However, it is expected to back the 0.6700. The New Zealand dollar will have the opportunity to test the resistance of 0.6745/0.6760.
USD/CAD
1.3650/1.3665 resistance
1.3590/1.3570 support
The Sino-US trade war has eased and it is expected to promote the normalization of international trade, which will also bring benefits to the Canadian economy. Moreover, the price of crude oil in the United States has risen, which indirectly affects the Canadian dollar. Technically, the Canadian dollar may still be weak, but the three-time challenge of 1.3665 resistance failed. If there is no negative factor that causes the Canadian dollar to fall, the USD/CAD trend is expected to return to below 1.3600. It is recommended to trade the US dollar against the Canadian dollar, paying attention to the development of crude oil price performance and the Canadian dollar.
EURGBP
0.9020/0.9035 resistance
0.8980/0.8965 support
Under the Brexit risk assessment, the euro zone economy and interest rate market outlook is better than the UK, and the euro is expected to rise higher against the pound. Technically, if the euro against the pound remains above the support of 0.8965. The euro has a chance to rise against the pound and will see resistance at 0.9020 or 0.9035 in the short term.
EURCHF
1.1300/1.1320 resistance
1.1240/1.1220 support
The trend of the euro and the Swiss franc followed the performance of the dollar, but the trend was similar. The short-term fluctuation of the EURCHF remains narrow, and it is recommended to focus on the above proposed range of volatility.
XAUUSD
1282/1284 resistance
1276/1274 support
This morning, China’s manufacturing purchasing managers index recorded a contraction, only 49.7, affecting the performance of the Asia-Pacific stock market. In addition, the US government’s budget fund has not yet been passed, and some government departments continue to operate, maintaining risk aversion and rising investment risks, driving gold to rise. If the US Congress resumes negotiations, the US government will eventually receive financial allocations, which is believed to be bad for gold. Coupled with the progress of Sino-US trade negotiations, easing the risk aversion, It may be cool down the price of gold.
US crude oil futures
46.65/47.00 resistance
44.75/44.35 support
OPEC will start production reduction this month, Sino-US trade war is easing, negotiations have the opportunity to succeed, and there will be opportunities to drive crude oil prices to rebound. Currently technically it is expected to have resistance in the range of 46.65 and 47 dollars. Note that th US APl will announce the results of crude oil inventories on Friday morning, which may affect the price of crude oil.
US Dow Jones Industrial Index Futures US30
23685/24025 resistance
23150/23065 support
Some departments of the US government have stopped operating since failed to pass the budget fund, psychologically affecting the investment climate, and the US Dow may be go down at a high level. However, the current Sino-US trade war has eased, and at the same time it is expected to make progress, investment sentiment is heating up, and the US Dow is expected to test the key resistance of 24025.
BTCUSD
4000 / 4200 resistance
3450 / 3250 support
After the bitcoin correction, the US dollar weaker. It seems to support most of the crypto currencies. Now the Bitcoin at US3450 is a key support. Also 4000 and 4200 as strong resistance. Keep watching the range of the momentum, and looking any breakthrough.
Enjoy and happy trade! The content is for reference only. Please do ensure that you understand the risk. Wish Happy trading!
Information provided by ATFX, Chief Analyst of Asia Pacific: Martin Lam, Registered Australian Accountant/ Certified Professional Manager / Certified Financial Advisor Experienced Investor / Media Market Commentator Martin Lam has Over 17 years’ experience in global investment market. Familiar with the worldwide stock indices, precious metals such Gold and Silver, Crude oil and Forex. He operated Martin Currency Trading Company and had partnership with a number of well-known international financial corporations and institutions. Before he join ATFX, he was TeleTrade Greater China development and Sales Director. Mr. Lam attends Hong Kong Now TV and China CCTV finance channel once a week. He also had regularly invited by different media, such as DBC Digital Financial Channel, Hong Kong Economic Times, The Standard, Ming Pao to share his experience to trade in Forex, Precious metals, Crude oil and worldwide stock indices. Contact: [email protected] or wechat: ATFX_China
Legal: ATFX is a trading name of AT Global Markets Limited (ATGM, registration number 24226 IBC 2017). ATGM is an International Business Company in Saint Vincent and the Grenadines. Registered address is: the Financial Services Centre, Stoney Ground, Kingstown, St.Vincent & the Grenadines.