EUR/USD

Three-day advance from 1.0587 is taking a breather under 1.0770 barrier (upper Bollinger band) where rally faced first significant barrier.

Correction lower is expected on overbought conditions, with strong supports at 1.0705/00 (double Fibo 38.2% / rising 5SMA), expected to ideally contain and guard next pivot at 1.0670 (rising daily Tenkan-sen).

Scenario of final push towards target at 1.0825 (top of thickening daily cloud / falling 100 SMA) looks likely and is supported by bullish daily studies, with sustained break here expected to trigger further advance and expose 1.0931 (Fibo 61.8% of 1.1298/1.0339 downmove).

Conversely, extended dips below 1.0670 would risk extension to daily cloud base (currently at 1.0611), loss of which will generate stronger bearish signal.

Res: 1.0770; 1.0825; 1.0872; 1.0931
Sup: 1.0727; 1.0700; 1.0670; 1.0611

GBPUSD

Cable eases from fresh 5-week highs at 1.2540, where daily cloud top capped yesterday’s strong rally and today’s attempts to finally break above the cloud.
Easing on overbought conditions is under way, with initial supports at 1.2441/26 (broken 100SMA/ daily cloud base) being intact for now and guarding 1.2410 (Fibo 23.6% of 1.1986/1.2542 rally / 55SMA).
Daily Slow Stochastic is in overbought territory and may generate stronger bearish signal for deeper pullback.
The pair will be looking for the UK Supreme Court decision on A 50, due later today.
Overturn of High Court’s verdict from November could send pound significantly lower, while more likely scenario of Supreme Court decision would further support the pair.

Res: 1.2542; 1.2587; 1.2650; 1.2680
Sup: 1.2441; 1.2426; 1.2410; 1.2330

USD/JPY

The pair bounces from 112.50 support zone (former correction low of 18 Jan) that was retested after yesterday’s fall, but offers solid support for now.
Near-term action remains biased lower and consolidation is expected to precede final break below 112.50 base, for extension of the downleg from 118.65/59 double-top that would look for 111.97 (Fibo 38.2% of 101.17/118.65 rally) initially.
Bearish setup of daily studies supports scenario, with upticks expected to hold below 114.05 /30 zone (falling daily Tenkan-sen / daily cloud top).
Any sustained break here would delay near-term bears for extended correction.
Next strong barrier lies at 114.83 (Fibo 38.2% of 118.59/112.51 downleg) and guards upper breakpoint at 115.60 (19 Jan lower top.

Res: 113.60; 114.05; 114.30; 114.83
Sup: 112.85; 112.50; 111.97; 111.00

AUDUSD

The pair maintains bullish bias and attempts to clearly break above near-term congestion tops at 0.7570 zone.

Yesterday’s close marginally higher and today’s fresh attempts above 0.7600 barrier, generated fresh bullish signal for resumption of month-long rally from 0.7160 zone.

Strong bullish setup of daily studies supports scenario, with immediate focus at 0.7630 (Fibo 76.4% of 0.7776/0.7158 descend) and possible extension towards 0.7700 zone on break.

Daily Tenkan-sen in steep ascend continues to underpin (currently at 0.7517), along with 10/200SMA’s Golden cross at 0.7492.

Converged daily 100/200SMA’s also mark key n/t support at 0.7492, break below which would sour the tone.

Res: 0.7607; 0.7630; 0.7700; 0.7739
Sup: 0.7553; 0.7517; 0.7492; 0.7456

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