Daily Market Outlook: January 28, 2015

EUR/USD

The euro extended recovery rally off 1.1096 low, to probe above 1.14 barrier, with fresh high being posted at 1.1421, where descending daily Tenkan-sen line capped rally. Near-term studies remain positively aligned and support bounce from 1.1329, overnight’s correction low, for fresh attempts higher. Sustained break above Tenkan-sen, currently at 1.1387 and 1.1421 high, is required to open breakpoint at 1.1458, former low of 16 Jan, reinforced by daily 10SMA. Sustained break and close above here to complete three-day reversal pattern and signal further recovery, which would open next key barrier at 1.1680 lower platform, reinforced by daily Kijun-sen line. On the other side, bearish setup of daily and weekly studies keeps the downside vulnerable, with failure to extend recovery, expected to turn focus back towards fresh 11-year low at 1.1096 and psychological 1.1000 target, in extension.

Res: 1.1387; 1.1421; 1.1458; 1.1500
Sup: 1.1329; 1.1300; 1.1230; 1.1200




EUR/JPY

Near-term price action remains supported, as the price consolidates around 134 handle, on attempts to clear daily Tenkan-sen line at 133.88. Bullish resumption above 134 barrier and break above pivotal 134.68, former low of 16 Jan, also near Fibonacci 61.8% of 137.62/130.13 descend, to confirm recovery and look for daily 10SMA at 134.94, close above which is required to complete reversal pattern for stronger recovery towards breakpoint at 137.63, lower top of 20 Jan, also Fibonacci 38.2% retracement of 149.76/130.13, reinforced by daily 20 SMA. Alternatively, recovery rejection would risk formation of lower top and fresh leg lower, as overall picture maintains firm bearish tone and sees current rally as corrective phase, preceding fresh attempts at psychological 130 support and 128.50, Fibonacci 38.2% retracement of larger 94.10/149.76 ascend, in extension.

Res: 134.68; 134.94; 135.79; 136.00
Sup: 133.67; 133.00; 132.48; 132.00




GBP/USD


Cable maintains positive near-term tone, following yesterday’s close above daily 20 SMA and probe above important 1.5200/10 zone, former double-top and Fibonacci 38.2% of 1.5618/1.4950 descend. Corrective action off fresh high at 1.5221, found temporary footstep at 1.5150 zone, with extended pullback required to hold above 1.5110, daily 10SMA, to keep near-term bulls in play. Sustained break above 1.52 resistance zone is required to open pivotal 1.5267, 14 Jan lower top, above which to complete reversal pattern and signal stronger recovery. Conversely, break and close below daily 10 SMA, to signal lower top formation.

Res: 1.5200; 1.5221; 1.5267; 1.5317
Sup: 1.5152; 1.5110; 1.5059; 1.5000



USD/JPY

The pair remains in near-term sideways mode, congested under daily 20 SMA and daily, with range base being established at 117.20, daily Tenkan-sen line. Neutral mode of near-term studies maintains range trading, with break of either side, required to establish fresh direction. Break below 117.20 base, to confirm an end of near-term corrective phase and shift focus towards 115.83, 16 Jan low and key 115.55 support, low of 16 Dec 2014, as well as low of short-term consolidation under fresh high at 121.83. Conversely, sustained break above pivotal barrier at 118.85, to bring bulls back to play and shift focus towards next barriers at120.00/80.

Res: 118.25; 118.64; 118.85; 119.30
Sup: 117.70; 117.20; 116.90; 116.55



AUD/USD

The pair bounced from session low at 0.7899, where higher low was left for strong acceleration higher that probes above pivotal 0.8000 barrier. Rally so far reached 0.8023, Fibonacci 38.2% of 0.8293/0.7856 downleg and ticks away from 0.8031, former base, with sustained break here, required to resume near-term corrective rally from fresh low at 0.7856, towards daily 10/20SMA’s at 0.8068 and 0.8097 respectively, with break and close above, to signal stronger correction. Bullish near-term studies support the notion, along with MACD bullish divergence, forming on a daily chart. On the other side, recovery rejection and close below 0.80 handle, would soften tone and increase downside risk.

Res: 0.8023; 0.8054; 0.8068; 0.8097
Sup: 0.7970; 0.7900; 0.7856; 0.7800




AUD/NZD


The pair regained traction and nearly fully recovered pullback from 1.0753, 22 Jan high, which found support at 1.0576, Fibonacci 61.8% retracement of 1.0471/1.0753 upleg. Fresh rally, which established near-term price action above 1.07 handle, brought near-term bulls fully in play for eventual attack at 1.0753, break of which to resume recovery towards psychological 1.08 barrier and 1.0888, daily 100/200SMA’s death cross. Ascending daily 10SMA, currently at 1.0628, underpins the action and only break below would undermine near-term bulls.

Res: 1.0742; 1.0753; 1.0800; 1.0888
Sup: 1.0700; 1.0689; 1.0634; 1.0620




XAU/USD

Spot gold bounced from yesterday’s fresh low at 1272, where ascending daily Tenkan-sen line contained. Fresh rally was capped under psychological 1300 barrier, with fresh easing, diminishing signals given by yesterday’s bullish Outside Day. With near-term studies losing traction, return to 1272 low cannot be ruled out, however, positive setup of daily studies, signals for now limited downside action, as the price remains supported by ascending daily 10SMA and bull-trendline, drawn off 1167 low. Break above 1300 barrier to shift focus towards the upper targets again. Otherwise, loss of 1272 handle would risk extension towards strong support at 1253, Fibonacci 38.2% retracement of 1167/1307 upleg, reinforced by 200SMA.

Res: 1292; 1298; 1307; 1319
Sup: 1285; 1279; 1275; 1272