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Daily Forex Market Overview

In early Tuesday trading the Aussie rebounded against the US dollar finding resistance around 1.0252, following better than expected news about Retail Sales and Current Account. Retails sales rose to 0.9% on January compared to a revised minus 0.4% in December, while the Current Account deficit reduced to $14.7B in December quarter, down from previous deficit at $15.0B. Later on RBA maintained its Interest Rate unchanged, as expected, stating that “…with inflation likely to be consistent with the target, and with growth likely to be little below trend over the coming year, an accommodative stance of monetary policy is appropriate.” The currency pair jumped to weekly highs even though the interest rates are at record lows.

AUDUSD Makes the Moves in FX Markets Today, Yen and Euro Recover Slightly

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The USDJPY dropped to 92.90 even though the BOJ nominee Haruhiko Kuroda continues the dovish comments about BOJ’s policy as soon as he will lead. As long the Yen recovers and the Aussie strengthens, the AUDJPY remains in a range between 95.62/94.42.

The single currency against the greenback did not move much and actually rebounded from 1.2964 to 1.3050 trading as of writing. Despite that Italy’s political uncertainty and possibly failure to precede passing structural reforms and austerity measures the euro recovered, traders are cautious ahead of the ECB meeting on Thursday.

Technical Analysis: USD/CHF

Bullish development prevails as the chart exhibits, with prices rising above key resistance and now support at 0.9386 as well as inching over the upper Bollinger band. Nonetheless, Stochastic and Momentum (7) are extremely up extended with the RSI(14) retracing slightly below the overbought barrier line. The latter suggests either consolidation or corrective move is to follow, still upside cap at 0.9464 is not considered major resistance, as a virtue of that further upside holds some chances towards 0.9510.

Limiting bulls at the upside barrier created by upper Bollinger band at 0.9464 would induce prices either to enter into consolidation mode ranging between 0.9464/0.9386-0.9297, or enter into corrective move that could lead even below the 20 & 50 SMA at 61.8% Fibonacci level around 0.9191. Conversely, upside extension above 0.9464 would approach key cap at 6-month highs around 0.9510.

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