GBPUSD - 1H chart showing weaknessDaily is in a sideways market type but the 1H is showing weakness.
We rejected 1.3000.
Targets below 1.2958 are 1.2900 and 1.2800.
Caution as this week's Brexit votes are pivotal for GBP.
Fxrenew
GBPUSD - Negative Momentum within Sideways Market TypeGBP remains within a sideways market type.
Momentum is negative ahead of key votes this week.
200 SMA and 55 SMA may provide turbulence.
CADJPY - Nearing T1 ahead of NFPOur CadJpy call is proving successful with prices close to our T1.
Ahead of NFP, we suggest reducing exposure or trailing stop to par.
EURUSD - Short-Term Resistance should holdThe Euro is retracing intraday but the 20SMA and 1.1200 should hold and push price back down.
EURUSD - Volatility Breakout into Bear Market TypeThe Euro has broken into a Bear Market Type after the ECB.
RSI remains extended but with a Central Bank behind the move, believe in continuation.
Dax - Signs of Exhaustion in Bull Market TypeDax is showing exhaustion near recent highs.
This pause may be due to the ECB meeting today.
Momentum readings are slightly negative but have space to move.
This may pull JPY crosses down also.
CADJPY - Bearish Momentum within Lateral Daily Market TypeThere are fundamental reasons to sell Cad in the short-term after Bank of Canada.
Beware of Daily market type and extended momentum readings.
Manage trades intraday as core position.
EurUsd - D1 Volatility ContractionStaying with the Euro, ahead of tomorrow's ECB meeting, we have a D1 volatility contraction.
Caution is advised for shorts with RSI close to extreme levels.
Market type still neutral/lateral.
EurUsd - Still Biased ShortEurUsd continues to soften into today's London Session.
The market is expecting a dovish ECB meeting tomorrow and has been selling Euros in anticipation.
Volatility remains low ahead of the meeting so caution is still warranted.
EurUsd - Weekly Volatility ContractionIntraday FX trading has been choppy since 2019 started. We are paying attention to the volatility contraction on EurUsd (which accounts for 60% of the DIXY) which is a weekly contraction and quite influential. The breakout will be quite important.
DXY - Shorts in Play The DXY has bounced the range top that has contained action for most of 2019 so far, and has printed a lower high.
The odds now favour further losses for the DXY.
WTI - Low Volatility Breakout in ProgressWith Opec production cuts, ongoing outages in troubled Venezuela and optimism on trade talks with China, Crude Oil is pushing upwards and has staged a low-volatility breakout.
USDCAD - Downside Risks We like USDCAD shorts due to three main factors: a dovish shift from FOMC that is weighing on the USD; tensions in Venezuela which are keeping Crude Oil prices up; and finally better domestic data from Canada.
Shorts should keep USDCAD compressed between 1.3100 and 1.3140s on any retracement.
Targets are initially 1.3050, 1.3000.
DXY - Biased Lower post- FOMCPowell has changed the language in the FOMC statement and has recognized the worse economic and financial conditions. The Fed is now on hold and perhaps in the future may need to lower rates.
For now, the USD has closed below the interim support and is now biased lower.
Gold and Dow - Rising as USD fallsGold and Dow are moving in Sync these days, which we believe is driven by more than USD weakness. Our view is that the FOMC has finally recognized the global slowdown (see PMIs).
End of Month Flows - Light USD and EUR selling expectedA quick comparison of equity performance in 2019 would suggest month end rebalancing requires a tad of EUR and USD selling. Nothing to write home about however.
DXY - Still Within the Range ahead of FOMCChoppy trading conditions continue as the USD remains within it's broader range into 2019. This week's events should spur some directional momentum (FOMC & US/China trade talks) but for now, sitting on hands is the best bet.
Gold - Low Volatility Breakout Key to last week was the WSJ report that the Federal reserve will “ease up” on its quantitative tightening. Not only has the Fed been hiking rates but it has been reducing its balance sheet. Both of these are forms of tightening. Slowing down the reduction of the balance sheet should have a stimulatory effect and in particular be positive for stocks. Of course, it is also dollar negative.
Gold received a boost on this news, and staged a low-volatility breakout.
NZDUSD - Biased LongKey to last week was the WSJ report that the Federal reserve will “ease up” on its quantitative tightening. The Kiwi dollar received a boost last week when inflation numbers beat expectations. Dairy prices were up 4.2% at the last auction. Government spending should provide a temporary boost to GDP in the early part of this year. Additionally, the NZ stock market remains robust and attractive. With the WSJ story mentioned above positive for risk assets, NZD becomes a decent option.
DXY - Going nowhere fastWe remain largely flat these days on our short-term models as a lack of momentum and a broad lack of direction on the DXY keeps FX markets subdued.
EURUSD - Biased Short Towards 1.1300The Euro is pushing through last week's lows as some risk-off sentiment adds strength to the USD.
We believe 1.1300 is a possibility today, and in any case the path of least resistance is short (for the time being)
as evidenced by a large majority of retail punters fading this move lower.
Gold - Preparing a consolidation breakout higherOur stance on Gold is currently bullish and we like the odds of further upside on a break of the recent consolidation.
