US Dollar Recovers Ground Post Intraday Losses

Key Highlights

• US dollar managed to trim most of the recent losses against the Euro and traded a touch higher.

• Japanese Securities investment, released by Ministry of Finance came in at ¥675.2B, compared with the last reading of ¥45.6B.

• Japanese Securities investment was also released around the same time, which registered a reading of ¥-104.8B whereas the last one was ¥466.9B.

• Australian HIA New Home Sales released by the Housing Industry Association decreased by 1.9% in December 2014, compared with the preceding month gain of 2.2%.

• Australian Retail Sales released by the Australian Bureau of Statistics managed to come in at 0.2%, compared to the forecast of 0.4% and previous reading was 0.1%.

• BOE interest rate decision is one of the major releases lined up today during the London session which might impact pairs such as GBPUSD and EURGBP.

• Aussie dollar is still under pressure against the US dollar and might continue to trade lower if sellers remain in control.

AUDUSD

The Aussie dollar after a sharp decline towards the 0.7620 support area against the US dollar managed to gain traction and moved back higher. However, the upside was stalled around an important resistance trend line which prevented buyers to take control. Moreover, the AUDUSD pair also failed around the 38.2% fib retracement level of the last drop from the 0.8229 high to 0.7625 low. In short, there is a lot of bearish pressure developing on AUDUSD, and the recent move can only be considered as a part of correction. Only a break above the 0.7850 level might push the AUDUSD pair higher.

Intraday Support Level – 0.7700

Intraday Resistance Level – 0.7820

• Overall, as long as the pair is below the highlighted trend line it might continue trading lower.

• A break above the trend line could take the pair towards the 0.8000 level.

On the downside, an immediate support is seen around the 0.7700 area. A break below the same might call for a move towards the last low of 0.7625.

GOLD

GOLD weakened a lot during this week and trimmed most of its last week gains. There is a major bearish trend line formed on the 4 hour chart of GOLD, which ignited a downside reaction in GOLD on many times. Moreover, the 100 simple moving average also acted as a catalyst in the near term. Moving ahead, we need to see whether buyers can clear the 38.2% fib retracement level and the highlighted trend line or not. A break above the same might ignite a move towards the $1290 level where sellers are likely to appear again.

Intraday Support Level – $1255

Intraday Resistance Level – $1280

• Selling rallies around the highlighted trend line look like a good option.

• A break above the $1275 level would call for more gains moving ahead.

On the downside, the last low around $1250 is the most important support for GOLD, which must hold if GOLD has to move back higher. A break of the mentioned level could ignite a move towards the $1240 level.

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