Daily Technical Analysis by XtreamForex

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AUD/USD CLOCKS SESSION HIGH AS RBA MINUTES SOUND MORE UPBEAT ON GROWTH
The Reserve Bank of Australia (RBA) June meeting minutes sounded more upbeat on growth, pushing the AUD/USD to a session high of 0.7427.

The minutes said, “the recent data is consistent with forecast acceleration in GDP growth to above 3 percent”, but warned that protectionist policies, political uncertainty in Italy and EM instability are a downside risk to the global outlook.

As of writing, the AUD/USD is trading at 0.7417. The upside is likely being capped by the fact that despite upbeat take on the economy, the policymakers are in no hurry to hike rates. Meanwhile, the Fed signaled faster rate hikes last week.

AUD/USD Technical Levels

Resistance: 0.7443 (50-hour moving average), 0.7468 (5-day moving average), 0.7540 (10-day moving average).

Support: 0.7412 (May 9 low), 0.7394 (session low), (0.7328 (May 2016 low).
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GBP/USD: PUT BIAS STRONGEST SINCE MAY 31 BY OMKAR GODBOLE

The GBP/USD one-month 25 delta risk reversals (GBP1MRR) fell to -0.60 yesterday – the lowest level since May 31, indicating the implied volatility premium for GBP puts is higher than the implied volatility premium for GBP calls.

The risk reversals had risen to -0.40 earlier this month.

The decline from -0.40 to -0.60 indicates rising demand for the GBP puts (sell GBP). It appears the investors are expecting a deeper drop in GBP and hence are seeking downside protection.
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USD/JPY PRICE FORECAST – GEOPOLITICAL RISK CONTINUES TO DRIVE PAIR

The world is in a very interesting place right now, through personal observation I have noted that it seems the Asians are much more concerned about the trade war situation than the Americans. This has led to a very interesting trade in the USD/JPY, as it seems the Asians are flooding to the Japanese yen, and the Americans will attempt to turn the trade back around.
The US dollar has been back and forth against the Japanese yen so far during the trading session on Wednesday, showing signs of life near the ¥110 level, and on the hourly chart it looks as if we are trying to roll over again. However, on the daily chart we have come very close to forming the “golden cross”, which is the 50 day simple moving average crossing over the 200 day simple moving average. By doing so, that is a longer-term “buy-and-hold” signal. While I don’t necessarily think that is the easiest trade to take right now, I do believe that once local markets get used to the idea of tariffs being a negotiating tactic by the Americans, that will come to understand that eventually there will be a consensus and an agreement between the Americans and the Chinese. If that’s the case, these market should go much higher.

Fundamentally speaking, the United States offers much more in the way of interest rates than Japan does, and that will remain the case for the foreseeable future. It is because of this that I believe that the pair will continue to go higher over the longer-term. That doesn’t mean that we will get the occasional pullback, but these sudden knee-jerk reactions should be thought of as gifts for buyers. Jumping in slowly and adding as the trade works out in your favor is more than likely going to be the way to play this pair going forward.
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MARKET MORNING BRIEFING: EURO AGAIN TESTED LEVELS NEAR 1.155-1.153

STOCKS

Dow (24657.80, -0.17%) closed below 24700 yesterday, reducing hopes of a bounce back just now. In case the index fails to rise above 24700 again, the index could turn significantly bearish in the coming sessions with chances of testing 24250-23750 on the downside.

Dax (12695.16, +0.14%) has attempted to move up slightly and if it manages to move above 12700 in the near term, the index could pick up some gains soon back to 13000. On the other hand if we see a fall again to levels below 12600, we would take a fresh look on the downside.

Nikkei (22681.38, +0.56%) has bounced from 22200 as expected and while that holds, the index could move up towards resistance at 22800 again. 22800 is a decent near term resistance and while that holds some range-bound movement within 22800-22200 is possible.

Shanghai (2927.70, +0.41%) seems to be holding above 2850 just now and could test 3000 before seeing another fall from there. Near term rise to 3000 is likely within a longer term bearish view.

Nifty (10772.05, +0.58%) continues to trade in the 10650-10850 region with no directional clarity for the medium term just now. continues to remain stable near 10800. A sharp down move is required to take it lower towards 10600. Sensex (35547.33, +0.74%) is also trading within the narrow 35250-35750 region and could soon come out of the range in the next 4-5 sessions.

COMMODITIES

Brent (74.63) has near term resistance at 76 which looks strong just now and may hold for a few sessions keeping the Brent prices lower. While below 76, Brent could test 73-72 before attempting a bounce back towards 76+ levels.

WTI (65.69) is stable for now and could range in the 64-67 region in the near term. While below 67, the price looks bearish but we do not see a fall below 64 just now. Overall some sideways movement is possible in the next few sessions.

Gold (1269.80) has broken below 1270 and while that sustains, medium term view turns bearish with possibilities of testing 1250-1240 in the coming sessions.

Copper (3.05) has come down sharply in the last 1-week and may bounce back from 3.0. On the other hand if the price fails to remain above 3, it could indicate a test of 2.95-2.90 in the near to medium term.

FOREX

Euro (1.1574): Euro again tested levels near 1.155-1.153 yesterday and has already dipped below crucial support on weekly candles near 1.156. While above 1.153, it might rise to 1.16 again in today’s session. A break below 1.153 could make it bearish towards 1.145 (89 weeks MA).

Dollar Index (95.15): Dollar Index is gradually moving up towards resistance near 95.5-95.6 on the 3 day line chart, which could be tested by next week. A test of 1.145 by the Euro could correspond to a test of 96 by the Dollar Index in the coming 1-2 weeks.

Dollar Yen (110.56): As expected, Dollar Yen is continuing its oscillation between 111.0-109.5 this week. However Yen strength might resurface in the weeks ahead as markets get increasingly risk averse. A break below support on daily candles (near 109.5-110.0) sometime next week, is likely to make it bearish towards 107 in the medium term.

Euro Yen (127.98): Repeating yesterday’s comment: chances of bearishness in both Euro and Dollar Yen imply a possible break of horizontal support on weekly line chart (near 127.0) by Euro Yen in the next week. Dollar Yen @ 108 and Euro @ 1.145 gives a target near 124 (support on weekly candles) for Euro Yen – which could be possibly tested in 2-3 weeks.

Pound (1.3171): Pound is approaching support on 3 day candles near 1.31. There might be some support near 1.315, which is delaying a test of 1.31. However, we expect a downmove to 1.31 to happen by next week and a further dip towards 1.30 after that.

INTEREST RATES

Yesterday, the US Fed Chairman reiterated at a Central Banking Forum in Sintra (Portugal) that a gradual rise in interest rates would continue. This led to a slight pause in the risk averseness which had set in due to the increasing prospects of a US-China trade war.

The US 10 year yield rose from lows near 2.88% towards 2.94%. As we have been saying in the last few briefings, the 10 year yield is close to support on medium term chart near 2.9%. It’s inability to rise decisively above 3% indicates that the risk averse sentiment is strong and a decisive break of the support for a test of levels near 2.6% is a possibility in the weeks ahead.

Current US Yields: US 10 year (2.94%), 30 Year (3.08%), 5 Year (2.82%), 2 Year (2.57%)

Also as mentioned yesterday, US Yield curve inversion fears are gripping the bond markets. The less talked about US 10-7 Year spread is now near 0.031% and could possibly invert ie go negative soon. In the past, it has been a precursor to more important spreads ie (10-5 and 10-2) inverting. The 10-2 Year spread had broken long term support near 0.4% in the last few days and is currently near 0.37%.

German 10 year yield (0.38%) could move lower towards support near 0.3% on the medium term chart in the next 1-2 weeks.
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STELLAR’S LUMEN TECHNICAL ANALYSIS – BACK IN THE BEAR TRAP
It’s back in the red for Stellar’s Lumen and the broader market, with a failure to recover through the day raising the prospects of sub-$0.20 levels before any rebound in the coming weeks.
Key Highlights
Stellar’s Lumen gained 1.09% on Tuesday, following Monday’s 1.83% rise, to end the day at $0.23412.
A morning pullback to an intraday low $0.22986 saw Stellar’s Lumen hold well above the day’s first major support level at $0.2212.
An afternoon rally saw Stellar’s Lumen move through to an intraday high $0.24236 to test the first major resistance level at $0.2431 before easing back to $0.23 levels by the day’s end.
In spite of the gains, Stellar’s Lumen continued to fall well short of the 23.6% FIB Retracement Level of $0.2648, supporting the extended bearish trend.
Stellar’s Lumen Price Support
Stellar’s Lumen gained 1.09% on Tuesday, following on from Monday’s 1.83% rise, to end the day at $0.23412.

Following the broader market, Stellar’s Lumen fell to an intraday low $0.22986 in the early part of the day, the morning’s low holding well above the first major support at $0.2212.

A late morning recovery saw Stellar’s Lumen rally through to an intraday high $0.24236 to test the day’s first major resistance level at $0.2431 before pulling back to sub-$0.23 levels by the day’s end, the failure to break through the first major resistance level to take a run at the 23.6% FIB Retracement Level of $0.2648 continuing to support the extended bearish trend formed at late April’s swing hi $0.46547.

At the time of writing, Stellar’s Lumen was down 2.82% to $0.22772, with Stellar’s Lumen pulling back from a start of the day $0.23657 high to a morning $0.22206 low, in what’s been a relatively choppy start to the day, Stellar’s Lumen falling through the first major support level at $0.2285 and second major support level of $0.2229 before a partial recovery through the morning.

For the day ahead, a move through to $0.2354 would support a run at the day’s first major resistance level at $0.2410, though with the broader market sitting deep in the red at the time of writing, Stellar’s Lumen will likely struggle to break through to $0.24 levels through the day, the early pullback to sub-$0.23 levels continuing to point to a possible near-term sub-$0.20 low before any meaningful recovery.

Failure to break back through to $0.23 levels would likely see Stellar’s Lumen take a bigger hit later in the day, with the second major support level at $0.2229 in back in play through the afternoon before any recovery.
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AUD/USD AND NZD/USD FUNDAMENTAL DAILY FORECAST – RBNZ COULD PUSH RATE HIKE FURTHER INTO FUTURE, OR CUT RATES

The Reserve Bank of New Zealand decided to leave its benchmark interest rate unchanged at 1.75 percent. Traders are saying they knew that rates would stay the same, but they were surprised by the grim tone of Reserve Bank Governor Adrian Orr’s comments. Based on his comments, traders are now saying that a rate hike is a long way off, but the chances of a rate cut cannot be eliminated

The New Zealand Dollar is trading slightly lower early Thursday after a steep sell-off the previous session. At 0545, GMT the NZD/USD is trading .6776, down 0.0019 or -0.27%. The AUD/USD is at .7352, up 0.0012 or +0.16%.

Earlier in the session, in a widely expected move, the Reserve Bank of New Zealand decided to leave its benchmark interest rate unchanged at 1.75 percent. The tone, however, of the RBNZ rate statement suggested the central bank looks to be leaning towards a more “dovish” stance in response to weaker-than-expected growth numbers.

Traders are saying they knew that rates would stay the same, but they were surprised by the grim tone of Reserve Bank Governor Adrian Orr’s comments. Based on his comments, traders are now saying that a rate hike is a long way off, but the chances of a rate cut cannot be eliminated.

Orr, in his statement, kept the door open, saying the central bank was well-positioned to manage change in either direction –up or down – as necessary. He also said the outlook for the New Zealand economy, as detailed in the bank’s May statement policy statement, remained intact.
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USD/JPY FUNDAMENTAL DAILY FORECAST – HAWKISH FED INTEREST RATE OUTLOOK UNDERPINNING PRICES

On Thursday, concerns over the deteriorating trade relationship between the U.S. and its trading partners in China and the European Union will continue to be the biggest influence on the price action. Traders should also continue to monitor the direction of U.S. Treasury yields and investor appetite for risk.
The Dollar/Yen is trading slightly higher on Thursday after recovering from earlier weakness. The Forex pair is trading inside yesterday’s range which indicates investor indecision and impending volatility. It also means there hasn’t been a follow-through to the upside following Wednesday’s 0.23% gain.

At 0507 GMT, the USD/JPY is trading 110.301, up 0.029 or +0.03%.

Trader indecision can be expected because yesterday’s strong rally was confusing to those that follow the traditional indicators – Treasury yields and demand for risk.

With yields tumbling on Wednesday and U.S. stocks finishing lower after giving back solid gains across the board, one would have thought the USD/JPY would’ve traded lower. Instead the Forex pair rallied.

I’m going to chalk up the rally to technical factors since going into the session, the Dollar/Yen was coming off of a potentially bullish closing price reversal bottom formed the day before.

At the end of the session, bruised and battered investors chalked up the price action to lingering global trade tensions which prompted traders to ditch most high-yielding currencies and a renewed focus on expectations the Federal Reserve will continue to raise interest rates.
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BITCOIN CASH, LITECOIN AND RIPPLE DAILY ANALYSIS – 28/06/18

The crypto majors are back in the red as investors lock in Wednesday’s gains, cutting back any hopes of a near-term extended rally to reverse the continued bearish trend.
Bitcoin Back in Reverse

Bitcoin Cash gained 2.78% on Wednesday, partially reversing Tuesday’s 7.96% loss, to end the day at $713.6.

A start of the day fall to an intraday low $685.1 saw Bitcoin Cash hold above the first major support level at $671.43, before a late morning bounce led Bitcoin Cash back through to $700 levels, with a morning high $721.9.

An upward trend through the rest of the day saw Bitcoin Cash strike an intraday high $724.1 that came up short of the first major resistance level at $737.43, before easing back at the end of the day.

At the time of writing, Bitcoin Cash was down 0.86% to $707.3, with Bitcoin Cash hitting a morning high $724.8 at the start of the day before pulling back to a morning low $701, the moves through the early part of the day leaving the first major resistance level at $730.1 and first major support level at $691.1 untested early on.

For the day ahead, a move through to $710 levels would support a run at the day’s first major resistance level at $730.1, though for a move through to $730 levels, sentiment across the market will need to improve, investors locking in Wednesday’s gains in the early hours.

Failure to move back through $710 to take a run at $730 could see Bitcoin Cash take a bigger hit later in the day, sub-$700 support levels in play, with the extended bearish trend firmly intact.
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BITCOIN CASH, LITECOIN AND RIPPLE DAILY ANALYSIS
The majors consolidated Friday’s gains on Saturday, but the sea of red returned in the early hours of the day to test investor resolve ahead of Monday, the majors needing to reverse the morning’s gains to go into the week on a high note.

Bitcoin Consolidates

Bitcoin Cash gained 4.35% on Saturday, following Friday’s 9.08% recovery, to end the day at $747.7, taking Bitcoin Cash into positive territory for the week, up 0.08%.

Friday’s late rally continued into the early hours of Saturday, with Bitcoin Cash breaking through the day’s first major resistance level at $756.37 to a morning high $787.4, before easing back to $750 levels through the morning.

An afternoon pullback saw Bitcoin Cash fall to an intraday low $722.3, holding above the first major support level at $717.53, before recovering late in the day to consolidate Friday’s gains with interest.

At the time of writing, Bitcoin Cash was down 2.69% to $727.8, with the late Saturday recovery reversing in the early hours, Bitcoin Cash pulling back from a start of the day $753.2 high to a morning low $727.7, the morning’s moves leaving major support and resistance levels untested.

For the day ahead a move back through $752.47 would support a run at the day’s first major resistance level at $782.63, though following two consecutive days’ of gains, some profit taking would be expected going into Monday, the extended bearish trend still intact in spite of the recent gains.
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MARKET MORNING BRIEFING: DOLLAR YEN HAS BROKEN ABOVE CRUCIAL RESISTANCE LEVEL NEAR 110.75

STOCKS

Dow (24271.41, +0.23%) has risen and while the daily trend support near 24000 holds, the index could move up towards 25000. Near term looks bullish.

Dax (12306, +1.06%) is stable and is stuck in the broad 12400-12100 region just now. Break below 12100 support could take it lower towards weekly support near 11800 as mentioned last week. Watch price action near 12100.

Nikkei (22288.67, -0.071%) is stable while above 22000 and could gradually try to move back towards 22600-22800 levels. Overall broad movement in the 22000-22800 region looks likely in the medium term.

Shanghai (2823.43, -0.84%) bounced back to trade slightly higher. While above 2750, there is chance that the index could trade sideways for sometime within 2750-2850 levels. But a break below 2750 in the medium term could open up further downside of 2700 in the longer run.

Nifty (10714.30, +1.18%) rose back sharply from levels near 10550 and is again set to test resistance near 10850. A break above 10850 would be indicative of bullishness in the longer run, negating a sharp correction from here.
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