EURUSD
The Euro rallied to a three-year high yesterday Tuesday, as the ECB Members’ comments on the Bank’s ability to end the Stimulus Program were positive.
With the Euro Zone seeing its best growth in a decade, the ECB should gradually shift its stance to avoid a more disruptive move later and look at a broader revision of its policy guidance to reduce the focus on bond purchases and raise the emphasis on interest rates
The EURUSD pair’s success in breaching near resistance levels at 1.2300 will boost optimism and push the price test to 1.2350 levels. A return below 1.2250 support would temporarily ease the bias.
GBPUSD
The royal currency fluctuated towards a downtrend during the Asian session following a series of gains in previous sessions.
Technically in the near term, analysts anticipate a definite breach at the pivotal resistance of 1.3820 to confirm a return to the main upside direction, with positive targets likely to be achieved starting at 1.3860
A break of support level at 1.3780 will push the price back to the downside correction track and possibly test 1.3760
USDJPY
The USDJPY fell sharply during this morning’s trading session trading near four-month lows. The Japanese Economy released its annual PPI Data for the month of December, rising 3.1% from expectations of 3.3%.
The decline in Inflation follows the pressure growing on the Bank of Japan to rethink its stock purchases with Central Bank officials worrying that a premature pullback could send the wrong message by suggesting that the BOJ has given up its commitment to reaching 2% inflation.
The negative Inflation Data thus added to the negative pressure on the Yen, despite the Dollar’s slide against other major currencies.
Technical reading shows that the USDJPY pair is trying to absorb the current selling pressures. With no clear signs of a reversal of the overall bearish trend, the pair has managed to breach 111.00 resistance levels allowing the market to correct higher and possibly hit the second resistance test at 111.20. A break of the support level at 110.80 would consolidate the bearish trend.
XAUUSD/GOLD
Gold prices continued to rise during Tuesday’s Asian Session for the fifth session in a row as the Dollar continued to trade near a three-year low. The US Dollar’s performance is a clear reflection of Investor worries in the markets.
Technical reading shows that Gold prices are trying to catch a breath after the recent strong rally. With no signs of a general upward trend change, only a break of support levels at 1338 would allow prices to fall further likely testing the 1330 levels. At the same time, a breach of resistance levels close to 1344 will consolidate the upward trend and may test 1348 levels.
