Forecast for 20th January 2015 GENERAL OVERVIEW Shares in Europe and Asia rose on Tuesday and the dollar strengthened against the yen after China said its economy had not slowed as much as many in markets had feared. However, the International Monetary Fund cut its forecast for global growth in 2015 by three-tenths of a percent to 3.5 percent and called on governments and central banks to pursue accommodative monetary policies and reforms. Oil prices steadied after an initial dip on prospects of weaker demand in China, the worlds second largest economy. But rising hopes for more stimulus from the European Central Bank later this week helped lift stocks around the world. Chinas economy grew 7.4 percent in 2014, just missing official forecasts of 7.5 percent, its slowest growth in 24 years. But fourth-quarter expansion held steady at 7.3 percent, down on the previous three months but marginally better than expected. A slew of Chinese data, which also showed factory output and retail sales beating forecasts in December, lifted Asian shares.The Shanghai Composite index rose 1.85 percent and the CSI300 closed up 1.22 percent. Japans Nikkei 225 index saw its biggest one-day gain in a month, ending up 2.1 percent. MSCIs main index for Asian shares, excluding Japan,, was up 0.3 percent. European shares rose, also boosted by expectations the ECB would launch as soon as Thursday a programme of money-printing through purchases of government bonds in a bid to fight off deflation and kickstart growth. The dollar rose against the safe-haven yen and was last up 0.7 percent at 118.42 yen, and the euro was all but flat on the day at $1.1611. In anticipation of looser ECB policy, the euro hit an 11-year low of $1.1459 on Friday. Ahead of the ECB meeting, yields on euro zone government bonds have touched a series of record lows. Most yields held near those lows on Tuesday, with the market awaiting a sale of 10-year Spanish debt via syndication. Brent crude oil traded flat, recovering from earlier falls, and was last at $48.86 a barrel. The benchmark price has lost some 60 percent since June. Concerns about global economic growth kept gold near a four-month high. Spot gold was last at $1,291.60 an ounce, pulling back from $1,294.18, its highest since late August. Technical Details: USD/CHF: Pair in sharp bearish fall below 0.900 and should keep the down trend below that level to test support levels 0.888 and 0.876 trading above 0.900 should push price higher to test resistance at 0.920 and 0.980 Major Trend: Weak/Up Key Support/Resistance Level: 0.900 Price Action Alert: Bearish Breakout USD/JPY: Price trading above support 117.70 and should remain bullish above that level and test resistance at 118.50 and 119.25 trading below 117.70 should start a bearish reversal to test support at 116.99 and 116.20 Major Trend: Up Key Support/Resistance Level: 117.70 Price Action Alert: Possible End Of Bearish Correction GBP/USD: Price trading above 1.505 and should start a bullish wave above that level to test resistance at 1.525 and 1.531 trading below 1.505 would continue the down trend to support levels 1.500 and 1.495 Major Trend: Weak/Down Key Support/Resistance Level: 1.505 Price Action Alert: Price Oversold EUR/USD: Price trading below support at 1.180 and should remain bearish below that level and test support at 1.175 and 1.170 trading above 1.180 should start bullish correction to resistance zone at 1.188 and 1.195 Major Trend: Down Key Support/Resistance Level: 1.180 Price Action Alert: Bearish Pressure AUD/USD: Price reached resistance at 0.823 and should start a bearish wave below that level and test support at 0.818 and 0.813 trading above 0.823 should start bullish reversal to resistance zone at 0.827 and 0.831 Major Trend: Down Key Support/Resistance Level: 0.823 Price Action Alert: Price Overbought Conclusion: Persistent fears over the health of the global economic recovery and mixed economic reports from US and European zones. Dollar showing more gains vs. all major currencies, especially EUR and Russian Rubel. Oill prices still lower than healthy levels. Trading major assets, short term, with strict money management is highly recommended. Important Economic News: German ZEW Economic Sentiment – For EUR – Time: 10:00 GMT Manufacturing Sales m/m – For CAD – Time: 13:30 GMT
Posted on: Tue, 20 Jan 2015 19:32:55 +0000
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