Intraday Technical Analysis 31 January

Private sector hiring, as measured by ADP/Moody’s showed a headline print of 213k for January. This beat the median estimates which pointed to a 180k increase during the period.

The U.S. pending home sales report showed a monthly decline of 2.2% which was worse than the forecasts of a 0.8% increase. Pending home sales declined following a 0.9% revised reading for the month before.

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The FOMC meeting left interest rates unchanged as widely expected. The Fed chair, Jerome Powell clarified that the Fed did not change course on its monetary policy due to Trump’s comments.

“What we care about … is doing our job for the American people and using our tools,” Powell said at the press conference.

The Central Bank signaled that it would remain patient in hiking interest rates indicating that rates will remain steady until at least the second quarter of this year.

More data from different economies

Looking ahead, the economic data during the Asian trading session showed that Australia’s import prices grew 0.5% on the quarter beating estimates of a 0.3% increase.

China’s manufacturing and non-manufacturing PMI reports released today showed an increase of 49.5 and 54.7 respectively.

Data from the Eurozone on the day will see the release of the German retail sales for December. Economists forecast that retail sales declined 0.5% during the month.

Later in the day, the flash GDP and inflation estimates from Spain will be coming out followed by the Eurozone’s flash GDP numbers for the fourth quarter of 2018. Economists forecast that the Eurozone’s GDP rose 0.2% on the quarter, unchanged from the preliminary estimates. The unemployment rate in the Eurozone is expected to hold steady at 7.9%.

The NY trading session will see the release of the monthly GDP numbers from Canada. Growth could have contracted 0.1% during the month.

EURUSD Intraday Analysis

EURUSD (1.1493): The Euro posted strong gains on Wednesday following the reversal off the intraday lows near 1.1413. Price action maintained the bullish momentum in the near term with the next resistance level seen at 1.1575. Any near term declines could be seen holding near 1.1461 where support is now likely to be established. Overall, the EURUSD currency pair remains trading flat near the current levels. However, a rebound off 1.1461 could potentially shift the bias to the upside.

AUDUSD Intraday Analysis

AUDUSD (0.7253): The AUDUSD currency pair reversed losses and managed to close above 0.7191 level of resistance. This has put the next resistance level at 0.7292 within target. We expect the AUDUSD to test this level of resistance in the near term before price action is likely to settle into a range within the said support and resistance levels. To the downside, support could establish near 0.7191 which supposedly retest in the near term. Considering that the lower support at 0.7022 has not been tested for support, we expect to see some risk to the upside.

XAUUSD Intraday Analysis

XAUUSD (1318.43): Gold prices maintained the gains as price action closed at 1319 before posting intraday highs of 1323. The main resistance level around 1335 – 1328 level could retest in the near term. There is a possibility that the bullish momentum could be easing near the highs as gold looks to post a modest correction to establish support around the 1300 level in the near term. However, the main support at the 1280 handle has held firmly so far. The hidden bearish divergence on the daily chart also validates the possible easing of the momentum in the near term.