EUR/USD: bears gaining ground, confirmation needed

EUR/USD Current Price: 1.0860

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It was another dull day across the forex board, as majors lacked directional conviction, despite there were plenty of action among equities and commodities, and the release of several macroeconomic figures. Germany released its wholesale price index, down by 1.0% in December 2015 compared to a year before, whilst monthly basis declined by 0.8%. Also, the ECB released the Minutes of its latest meeting, showing that some members of the government council were looking for a bigger cut in the key interest rate up to 20 basis point. The news were generally EUR negative, but the currency moved in respect of stocks and nothing else.  The calendar will be a bit more interesting in the US this Friday, with the release of Retail sales figures for December, and the latest PPI readings, alongside with Michigan consumer's sentiment and some industrial data, which may set the tone for the upcoming week. 

Trading in the red, the EUR&USD pair hovers around the 1.0845 region, the 38.2% retracement of the December rally, and  the 4 hours chart shows that the moving averages are now directionless and within a tight range, while the technical indicators move back and forth around their mid-lines, reflecting the ongoing range and giving no clues on what's next for the pair. Selling interest has been containing rallies around 1.0925, ever since the year started, and represents the 23.6% retracement of the same advance, while  buyers have appeared on approaches to 1.0800. Unless some extension beyond those limits, the pair will maintain a neutral stance and playing the range seems to be the way to deal with it. 

Support levels: 1.0800 1.0750 1.0710

Resistance levels: 1.0880 1.0925 1.0950 

EUR/JPY Current price: 128.24

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The EUR/JPY pair rallied to a fresh weekly high of 128.74, but retreated to its early week range, where it stands ahead of the close. The technical picture is neutral, with the price nearing the vortex of the triangle that contained the price ever since the week started, diminishing the validity of the figure from now on. In the 1 hour chart, the price is a handful of pips above its 100 and 200 SMAs, both with clear bearish slopes, while the technical indicators are flat above their mid-lines. In the 4 hours chart, a  mild positive tone comes from the technical indicators that head higher in neutral territory as the price presents higher lows daily basis, although the pair remains well below its moving averages, which reflect bears maintain the lead.

Support levels: 128.00 127.50 127.15 

Resistance levels: 128.55 129.05 129.50

GBP/USD Current price: 1.4412

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The GBP/USD pair is closing the day pretty much flat above the 1.4400 level, with the British Pound favored by a less dovish-than-expected, Bank of England as the Central Bank left its economic policy unchanged, with only one policy member, Ian McCafferty, voting for a rate hike, as he did for the past few months. The daily chart for the pair is a doji, reflecting investor's uncertainty at current levels, particularly after the pair declined steadily for the past weeks. Technically, the 1 hour chart shows that the price is above a horizontal 20 SMA, while the technical indicators lack upward strength, barely holding above their mid-lines. In the  4 hours chart, the price is still developing below a clearly bearish 20 SMA, now the immediate resistance around 1.4450, while the RSI indicator is aiming slightly higher from the near oversold readings, while the Momentum indicator aims higher, but still below the 100 level, all of which maintains the upside limited.

Support levels: 1.4350 1.4310 1.4260

Resistance levels: 1.4450 1.4490 1.4530

USD/JPY Current price: 118.16

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The USD/JPY pair advanced in the American afternoon, following a strong recovery in Wall Street, with the pair above the 118.00 figure by the end of the day, after trading as low as 117.28 earlier in the day. The pair continues trading on sentiment, with easing risk aversion doing little in weakening the Japanese currency. The short term technical picture is showing that, in the 1 hour chart, the price remains below its  200 SMA whilst the technical indicators are turning south from near overbought territory, supporting a downward corrective movement for the upcoming hours, although that will depend on Asian stocks' behavior. In the 4 hours chart, the price is far below its moving averages, while the Momentum indicator turned south above the 100 level, and the RSI indicator holds flat around 52, indicating a limited upward potential. The pair needs at least to recover above the 119.35 level to begin looking constructive, something unlikely for this Friday. 

Support levels: 117.70 117.30 116.90 

Resistance levels: 118.05 118.40 118.95 

AUD/USD Current price: 0.6982

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The Australian dollar failed to rally at the beginning of the day following a nice local job report, but finally advanced against the greenback as risk sentiment improved. Earlier in the day, the Australian  economy announced that it lost 1K jobs position during December, while the unemployment rate remained steady at 5.8%, against markets' expectations of an advance to 5.9%, yet the AUD/USD pair plummeted to 0.6909, as poor market's sentiment maintained the currency under pressure. Anyway, and despite the positive close, the pair remains below the 0.7000 level, which limits chances of a stronger recovery. Short term, the 1 hour chart shows that  the technical indicators are turning south from near overbought territory, while the 20 SMA heads higher below the current level, suggesting a limited bearish corrective movement ahead. In the 4 hours chart, the price stalled around a horizontal 20 SMA, while the technical indicators have lost their upward strength after reaching their mid-lines, in line with the dominant bearish trend. 

Support levels: 0.6960 0.6905 0.6870 

Resistance levels: 0.7000 0.7040 0.7075