• CL-OIL


  • Cocoa-C


  • View more

Daily Technical Insights 6 January 2023


EURUSD (4-Hour Chart)

The EUR/USD pair shows an upside momentum faltered once again around 1.0630  and dropped to daily lows near 1.0529, breaking below the support at 1.0536, EUR/USD is 100 pips down from its Friday close, the spot saw its losses accelerate after the US ADP report showed the US private sector added 235K jobs during December, surpassing initial estimates, besides, weekly Jobless Claims rose less than expected, both shows the good health of the labour market in US. On the Europe side, the Construction PMI improved marginally to 41.7 in December, and the released November Producer Price Index, which rose at an annual pace of 27.1%, retreating from a revised 30.5% gain in October, In the near term, the pair is neutral-to-bearish and lack the conviction to surpass the recent resistance area near 1.0660 for the time being.

For the technical aspect, RSI indicator 14 figures as of writing, it’s suggestion strong buying signals and indicates an oversold or undervalued condition, estimated to be bullish and will rebound from the bottom. As for the Bollinger Bands, the price keeps hovering around the upper bound signalling the upside traction maintained in the near term, and the drop is expected. In the US, the key event is Friday’s release of the US Dec non-farm payrolls and the Eurozone inflation report. On the Europe side, Key events in the euro area this week are the Germany Retail Sales, EMU Flash Inflation Rate, and EMU Retail Sales,  which may bring motivation for the EURUSD buyers into the market.

Resistance:  1.0661, 1.0710

Support: 1.0310, 1.0536, 1.0461

GBPUSD (4-Hour Chart)

GBP/USD comes under heavy selling pressure on Thursday amid resurgent USD demand due to the FOMC  Meeting Minutes and PMI  yesterday and the dollar-positive ADP report released today, this pair continues losing ground through the early North American session and weakens further below the 1.2000 and aiming at the Support at 1.1927. According to the data published by Automatic Data Processing (ADP), the higher-than-expected demand from the US private sector employers provides a strong boost to the US Dollar, which, in turn, exerts downward pressure on the GBP/USD pair, the less hawkish outlook keeps the US Treasury bond yields depressed near a multi-week low, which could act as a headwind for the buck and lend some support to the GBP/USD pair.

For the technical aspect, RSI indicator 14 figures as of writing, it’s a suggestion for strong buying signals and indicates an oversold or undervalued condition, estimated to be bullish and will rebound from the bottom. For the Bolling  Bands,  it indicates the high volatility of the market. Both signals indicate the investors are interested in buying the market, however, the daily chart has just started gaining negative traction, the GBP/USD pair might then turn vulnerable and go for the 1.1927 mark. In the US, the ADP indicates momentum for the Dollar market, Friday’s release of the US Dec non-farm payrolls and Eurozone inflation report would provide fresh signals. In the UK, the weaker-than-expected UK services PMI added to a softer near-term tone, and more signals are required to define near-term direction.

Resistance: 1.2110, 1.2233, 1.2335

Support: 1.1927, 1.1765

XAUUSD (4-Hour Chart)

Gold price staged a downside correction after a four-day winning streak. Gold price fell more than 1% on Thursday, retreating from the highest level from mid-June, driven by a stronger US dollar and soaring US Treasury yields. The dollar regained strength after US data, before NFP. The ADP employment report showed that private payrolls increased by 235K over the 150K of expectation. Initial Jobless Claims dropped to 204K, the lowest since September. Markets reacted to the US economic figures. The dollar index advanced to 105, the highest level in three weeks while the US 10-year yield rose from 3.70% to 3.77%. The gold price fell directly below $1,850 to $1,831. At the time of writing, the price is hovering around $1,830.

For the technical aspect, RSI indicator 48 figures as of writing, slipping from the overbought zone, suggesting that it may continue on the correction. For the Bollinger Bands, the price dropped through the average as the price stage a strong downside correction in the near term. In conclusion, we think the market is still in bullish mode as the price still rally above the upward trend line. However, the gold price can keep falling modestly as technical analysis shows that the gold price is still under correction. On the downside, if the price drops below the trend line, it may change its current uptrend and head to test the next support at $1,775.

Resistance: 1865

Support: 1775, 1735, 1700