From the FXWW Chatroom – USD
• USD slumped against all G10s on the back of improved demand in EUR
and JPY, while the Dollar Index plunged 1.15% to more than 5-week low at
• We maintain a bearish view on USD in anticipation of further advances in
EUR and on top of an absence of positive catalyst to drive USD gains. The
Dollar Index is likely to stay under pressure of 97.82 and likely to test 97.05
going forward, with chance to break lower to 96.58.
• EUR jumped 1.22% to 1.1025 against USD and closed higher against 6
G10s, revived by expectations that the ECB would steer clear from
increasing the size of its asset purchases for some time, and further
affirmed by ECB council member Nowotny.
• EUR is likely to sustain a slight bullish bias against USD, supported by
retreat in ECB stimulus outlook. Technically, EURUSD gains are likely
modest approaching firm resistance at 1.1065 but we expect rejection here
to be supported by 1.1010.
• GBP dipped slightly against 5 G10s on the back of firmer demand for
European majors but jumped 1.15% to 1.5181 against a sliding USD
amid firmer refuge demand.
• GBP is expected to maintain an upward trajectory against a soft USD,
supported by extended build-up in refuge demand. Technically, upsides
appear limited for GBPUSD, with gains likely restrained by 1.5216.
• JPY strengthened 1.21% to 121.44 against a sliding USD and advanced
against 8 G10s amid firmer support from refuge demand as equities
• We stay slightly bullish on JPY against USD on extended support from
refuge demand. There is more room on the downside than there is on the
upside for USDJPY; expect advances to be rejected by 121.76, which likely
triggers a drop to 120.92 going forward.
• AUD remained pressured by subdued equities and ahead of Australian
employment data, falling against 8 G10s but managed to climb 0.19% to
0.7229 against a weak USD.
• AUD is now bullish against a soft USD, lifted by strong Australian
employment figures. AUDUSD broke through 0.7298 in early trade but we
expect upside bias to lose its potency approaching 0.7336 – 0.7363 region,
which could potentially reject it lower to, or even below, 0.7298.
• SGD was also hit by equities decline, falling against 8 G10s but
strengthened 0.28% to 1.4049 against a weak USD.
• We now turn slightly bullish on SGD against a soft USD. USDSGD
downside break of several firm resistances is a sign of increased
bearishness, which we believe could soon test 1.3949 going forward. [HLB]