• EUR/USD followed daily RSI which broke below corresponding trendline support prior to price (as I highlighted last week) – See FX TECH LAB “Has it put in a medium-term top?”, breaking below its key level of trendline support around 1.3170 (rose from yesterday’s 1.3155/60 level) earlier today – While it remains below this level, keep an eye for a further continuation lower over the coming sessions. The next notable levels of support: top of the daily Ichimoku Cloud around 1.3095, 55-day sma at 1.3070/75 & then the 50% retracement around 1.3055 (using the 1/16 low & 2/24 high).
• USD/JPY has reacted to yesterday’s Tweezer Top formation (bearish reversal pattern) and daily RSI bearish divergence with a break below trendline support drawn from mid-February around 81.15. While the downside has so far been limited to 80.75, JPY-crosses have come under significant pressure – EUR/JPY broke back below its 200-day sma (106.85), AUD/JPY broke below the daily Tenkan line at 86.50/55 & now looks poised to test the 21-day sma around 85.25/30, and GBP/JPY is currently lower by around 180 pips (since 5pm ET), which is a slight recovery from down nearly 225 pips at one point today. U.S. 10-year yields are also turning lower once again (down 6bps today) and is currently testing the 50-day sma around 1.948%. A break below could test 1.89/90% prior yield lows which could weigh further on USD/JPY.
• AUD, NZD & CAD (Commodity Currencies) have taken it on the chin today as the daily RSI Divergences into their respective high/lows over the past few weeks suggested was inevitable. As I noted yesterday, Kiwi broke below its February lows around 0.8245/50 and AUD/USD has followed as it too broke below its respective Feb. lows near 1.0595 and is currently testing the 50-day sma around 1.0550/55. Interestingly, USD/CAD has still not broken above its corresponding Feb. highs at 1.0050/55, but with the moves lower in equities and commodities today it seems like it may be only a matter of time before it plays catch up.
• USD/CHF followed daily RSI, which broke above its corresponding trendline resistance in advance to price, as it too broke above resistance around 0.9135/40. Currently, the Franc is testing the 100-day sma around 0.9185/90 and a break above could see a further move towards 0.9260 initially which is the 55-day sma. Additional levels of resistance come in around 0.93 the figure (Feb. highs) and then the daily Ichimoku Cloud between 0.9310-30.
• Gold (XAU/USD) turned out to be nothing more than the dead-cat-bounce highlighted yesterday as it took out the notable level of support between $1688/93 – 38.2% retracement (using the 12/29 low & 2/29 high) and 100-day sma – See yesterday's TECH TALK. The yellow metal also took out the key 200-day sma at $1677/78 and has just tested the top of the daily Ichimoku Cloud around $1665. As always, what was support now becomes resistance, so look for the $1690/95 level to prove resistive over the coming sessions.
• Silver (XAG/USD) easily cracked below the 38.2% retracement near $33.15 (using the Dec. low & Feb. high) and then just recently tested the February low around $32.65. Should that fail to prove a sufficient level of support, keep an eye on the converging 50 & 200-day sma’s at $32.25/35.
• EUR/AUD broke above the highlighted 50-day sma around 1.2390/95 as well as the key horizontal pivot at 1.2420 – Thus, the best place to be is probably on the sidelines with the cross at the moment until something more significant materializes. For those still fixated with this pair, you may want to keep an eye on the 50% retracement around 1.2440 (using the 2/27 high & 3/2 low).
• USD/JPY has reacted to yesterday’s Tweezer Top formation (bearish reversal pattern) and daily RSI bearish divergence with a break below trendline support drawn from mid-February around 81.15. While the downside has so far been limited to 80.75, JPY-crosses have come under significant pressure – EUR/JPY broke back below its 200-day sma (106.85), AUD/JPY broke below the daily Tenkan line at 86.50/55 & now looks poised to test the 21-day sma around 85.25/30, and GBP/JPY is currently lower by around 180 pips (since 5pm ET), which is a slight recovery from down nearly 225 pips at one point today. U.S. 10-year yields are also turning lower once again (down 6bps today) and is currently testing the 50-day sma around 1.948%. A break below could test 1.89/90% prior yield lows which could weigh further on USD/JPY.
• AUD, NZD & CAD (Commodity Currencies) have taken it on the chin today as the daily RSI Divergences into their respective high/lows over the past few weeks suggested was inevitable. As I noted yesterday, Kiwi broke below its February lows around 0.8245/50 and AUD/USD has followed as it too broke below its respective Feb. lows near 1.0595 and is currently testing the 50-day sma around 1.0550/55. Interestingly, USD/CAD has still not broken above its corresponding Feb. highs at 1.0050/55, but with the moves lower in equities and commodities today it seems like it may be only a matter of time before it plays catch up.
• USD/CHF followed daily RSI, which broke above its corresponding trendline resistance in advance to price, as it too broke above resistance around 0.9135/40. Currently, the Franc is testing the 100-day sma around 0.9185/90 and a break above could see a further move towards 0.9260 initially which is the 55-day sma. Additional levels of resistance come in around 0.93 the figure (Feb. highs) and then the daily Ichimoku Cloud between 0.9310-30.
• Gold (XAU/USD) turned out to be nothing more than the dead-cat-bounce highlighted yesterday as it took out the notable level of support between $1688/93 – 38.2% retracement (using the 12/29 low & 2/29 high) and 100-day sma – See yesterday's TECH TALK. The yellow metal also took out the key 200-day sma at $1677/78 and has just tested the top of the daily Ichimoku Cloud around $1665. As always, what was support now becomes resistance, so look for the $1690/95 level to prove resistive over the coming sessions.
• Silver (XAG/USD) easily cracked below the 38.2% retracement near $33.15 (using the Dec. low & Feb. high) and then just recently tested the February low around $32.65. Should that fail to prove a sufficient level of support, keep an eye on the converging 50 & 200-day sma’s at $32.25/35.
• EUR/AUD broke above the highlighted 50-day sma around 1.2390/95 as well as the key horizontal pivot at 1.2420 – Thus, the best place to be is probably on the sidelines with the cross at the moment until something more significant materializes. For those still fixated with this pair, you may want to keep an eye on the 50% retracement around 1.2440 (using the 2/27 high & 3/2 low).