Video

John J Hardy
Saxo Bank’s head of FX strategy John Hardy takes a closer look at trends and moves in today’s forex charts, including EURUSD, USDJPY, AUDUSD, and EURSEK.
Article / 03 January 2018 at 15:52 GMT

FX Board: EURUSD hangs near 1.2000 after absurd ISM strength

Head of FX Strategy / Saxo Bank
Denmark
  • 112.00 area key in USDJPY
  • AUDNZD looking at sub-110.00 area
  • EURCHF peeking higher
New York
An unusually strong ISM release from the US has the greenback in focus, but the market's reaction remains muted overall. Photo: Shutterstock

By John J Hardy

Please see today's FX Board PDF attached to this post for the latest Notes of Interest, Trend and Trend Heat readings, as well as a few thoughts on key chart developments below.

Charts: USDJPY

Absurd strength in the US December ISM Manufacturing survey nets about a 10-12 pip reaction today, suggesting that the market is not looking to this data point for a reaction. For USDJPY, the technicals are getting interesting vis-a-vis the daily Ichimoku cloud and the interest picks up if the pair can take out the 112.00 area. If not and we rally back into the cloud, we risk remaining stuck in the 112 to 114-plus range for now.

usdjpy
Source: Saxo Bank 

EURCHF

EURCHF is trying yet again to look higher after the latest weekly drop in SNB sight deposits - but most of the prior rallies to new highs have failed to serve as a notable catalyst; the next potential test for the pair is around the EU CPI estimate on Friday.

eurchf
Source: Saxo Bank 
 
EURNOK

EURNOK has fully reversed the prior rally wave, setting up the potential for follow-through lower toward 9.55-65 if 9.80 remains in place as resistance.

eurnok
Source: Saxo Bank 
 
AUDNZD

AUDNZD trying to get interesting once again as it looks to reject the sequence below 1.1000. Focus on the 1.1300-plus area again if we can follow through higher here and threaten well above 1.1100 again.

audnzd
Source: Saxo Bank 
 
XAUUSD (weekly)

Spot gold has rallied impressively and persistently over the last few weeks. The move looks impressive locally, but really needs to persist without much of a hitch to keep the focus on the pivotal, structural $1,350-75/oz zone ($1,300-ish is the first important support).

xauusd
Source: Saxo Bank 

— Edited by Michael McKenna

John J Hardy is head of FX strategy at Saxo Bank  
Download document

FX Board for Wednesday, January 3, 2018

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