. Daily FX Analysis - AUD Stable, USD/JPY, NZD, GBP Rise.

Daily FX Analysis – AUD Stable, USD/JPY, NZD, GBP Rise.

Daily FX Analysis – AUD Stable, USD/JPY, NZD, GBP Rise.

08 Feb 2024

Introduction

The GBP/USD pair edges higher to 1.2630 in the early Asian session, supported by a weaker USD and increased UK house prices, indicating confidence that the Bank of England may not cut interest rates soon. Meanwhile, AUD/USD maintains gains above 0.6500 on mixed Chinese inflation data. NZD/USD holds positive ground above 0.6100 after strong New Zealand Q4 labor market data, suggesting potential further Reserve Bank of New Zealand policy tightening. USD/JPY sees modest gains above 148.00 amid dovish BoJ comments, while the Japanese Yen struggles amid declining real wages and household spending.

Markets In Focus Today – GBP/USD

GBP/USD drifts higher to 1.2630 on weaker USD, UK higher house prices.

The GBP/USD pair gained traction during the early Asian session on Thursday. The uptick in the major pair is bolstered by rising house prices in the UK, which supported bets that the Bank of England was not likely to cut interest rates soon. GBP/USD benefited from the improving risk mood on Tuesday and gained 0.5%, erasing a large portion of Monday’s losses in the process. Early Wednesday, the pair trades marginally higher on the day above 1.2600. Market participants will keep an eye on risk perception mid-week. According to the latest news, Qatar, acting as a mediator, said that Hamas had given a “generally positive” response to a proposed truce deal with Israel.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2645 | Negative Crossover | Bearish
  • MA 20 : 1.2664 | Negative Crossover | Bearish
  • MA 50 : 1.2640 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.2655 | Negative Crossover | Bearish
  • MA 20 : 1.2678 | Negative Crossover | Bearish
  • MA 50 : 1.2675 | Negative Crossover | Bearish

RSI (Relative Strength Index): 46.6354 | Buy Zone | Bullish

Stochastic   Oscillator : 38.9323 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 1.2762 R2 : 1.2806
  • S1 : 1.2617 S2 : 1.2573

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion: Limit Sell: 1.2658 | Take Profit: 1.2558 | Stop Loss: 1.2727

AUD/USD

AUD/USD keeps the green above 0.6500 after mixed China’s inflation data.

AUD/USD is holding mild gains above 0.6500 following the release of mixed Chinese inflation data. China’s CPI dropped 0.8% in January vs. -0.5% expected. A broadly subdued US Dollar is also helping the pair amid a better mood. US data and Fedspeak are awaited. The Aussie dollar found another excuse to extend the weekly bounce in the continuation of the downward bias in the greenback on Wednesday. Furthermore, Governor Bullock departed from the expected move towards a dovish stance and underscored the incomplete nature of addressing inflation, emphasizing that the current rate is unacceptably high.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.6542 | Negative Crossover | Bearish
  • MA 20 : 0.6575 | Negative Crossover | Bearish
  • MA 50 : 0.6600 | Negative Crossover | Bearish

Simple :

  • MA 10 : 0.6548 | Negative Crossover | Bearish
  • MA 20 : 0.6571 | Negative Crossover | Bearish
  • MA 50 : 0.6651 | Negative Crossover | Bearish

RSI (Relative Strength Index): 39.3167 | Sell Zone | Bearish

Stochastic   Oscillator : 35.0257 | Sell Zone | Neutral

Resistance   And Support Levels :

  • R1 : 0.6763 R2 : 0.6837
  • S1 : 0.6523 S2 : 0.6449

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion: Limit Sell: 0.6544 | Take Profit: 0.6467 | Stop Loss: 0.6594

USD/JPY

USD/JPY catches a bid above 148.00 after dovish BoJ commentary.

The Japanese Yen struggles to capitalize on widening Japan’s trade surplus, as dovish comments from the BoJ policymaker underwhelm, USD/JPY is posting small gains above 148.00, with the upside, however, capped by a weaker US Dollar. The Japanese Yen (JPY) attracted fresh sellers on Thursday and for now, seems to have stalled its modest recovery move against its American counterpart, from the YTD low touched earlier this week. Data from the labor ministry released on Tuesday showed that Japan’s real wages fell for the 21st straight month in December and household spending dropped for a tenth successive month. This is seen as an unwelcome development for the Bank of Japan (BoJ), which, along with a generally positive tone around the equity markets, seems to undermine the safe-haven JP.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 147.8823 | Positive Crossover | Bullish
  • MA 20 : 147.2825 | Positive Crossover | Bullish
  • MA 50 : 146.5833 | Positive Crossover | Bullish

Simple :

  • MA 10 : 147.8041 | Positive Crossover | Bullish
  • MA 20 : 147.5881 | Positive Crossover | Bullish
  • MA 50 : 145.3167 | Positive Crossover | Bullish

RSI (Relative Strength Index): 59.9022 | Buy Zone | Bullish

Stochastic   Oscillator : 76.2016 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 148.5458 R2 : 150.4342
  • S1 : 142.4322 S2 : 140.5438

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Stop Buy: 148.67 | Take Profit: 150.13 | Stop Loss: 147.82

NZD/USD

NZD/USD holds positive ground above 0.6100 following Chinese CPI and PPI data.

NZD/USD gains ground near 0.6118 amid the softer USD, and solid New Zealand Q4 labor market data. Following strong labor market numbers, the Reserve Bank of New Zealand could raise interest rates again this month. Fed’s Kugler said that inflation is showing solid signs of slowing down, but she is not yet prepared to begin lowering rates. The NZD/USD pair holds positive ground above 0.6100 during the early Asian session on Thursday. The solid New Zealand Q4 labor market data amid re-pricing odds of further Reserve Bank of New Zealand (RBNZ) policy tightening, has boosted the New Zealand Dollar (NZD). NZD/USD trades around 0.6118, gaining 0.16% daily.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.6106 | Positive Crossover | Bullish
  • MA 20 : 0.6126 | Negative Crossover | Bearish
  • MA 50 : 0.6135 | Negative Crossover | Bearish

Simple :

  • MA 10 : 0.6105 | Positive Crossover | Bullish
  • MA 20 : 0.6118 | Negative Crossover | Bearish
  • MA 50 : 0.6185 | Negative Crossover | Bearish

RSI (Relative Strength Index): 46.3795 | Buy Zone | Bullish

Stochastic   Oscillator : 51.2953 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 0.6267 R2 : 0.6329
  • S1 : 0.6066 S2 : 0.6004

Overall Sentiment: Neutral Market Direction: Buy

Trade Suggestion: Limit Sell: 0.6093 | Take Profit: 0.6177 | Stop Loss: 0.6044

Elsewhere In The Forex Market

EUR/GBP up 0.06% to 0.8535. The USD/CHF was down 0.13% to 0.8729. The USD/CAD is down 0.08% at 1.3451. EUR/USD up 0.09% at 1.0781. AUD/NZD is up 0.08% at 1.0670, USD/CNY is up 0.01% at 7.1946, and AUD/SEK is down 0.04% at 6.8277, at the time of writing.

Key Economic Events & Data Release Today:

(AUD) Building Approvals (MoM) Actual –9.5%, Forecast –9.5%, Previous 1.6% at 06:00. (CNY) CPI (MoM) (Jan) Actual 0.3%, Forecast 0.4%, Previous 0.1% at 07:00. (USD) Initial Jobless Claims Forecast 221K, Previous 224K at 19:00.