- The US dollar index bounced from key support in the US session, which saw sharp reversals on FX major pairs and suggests the dollar is not yet ready to embark upon its next leg lower.
- AstraZeneca claim their COVID-19 vaccine will be ready for Christmas, and that their latest tests show it is 90% effective at preventing the disease, if the vaccine is given to a person in two half doses. 30 million doses have been earmarked for Australia.
- Joe Biden has chosen former Fed Chair Janet Yellen as US Secretary Treasury, who will go on to replace Steven Mnuchin.
- US PMI data surprised to the upside, with manufacturing PMI hitting a 6-year high and Services PMI at a 5-year high.
- In the crypto space, XRP (XRPUSD) continued its explosive rally and how sits at a 2-year high. Over the past two days alone XRP has risen by 65% and 20%.
Today’s Calendar Events (Times are GMT+11 Sydney)
- No major economic data is scheduled for today.
- RBA’s Assistant Governor, Guy Debelle, is scheduled to speak at 13:30
NZD/USD: Its Tough at The Top
- Bulls have failed to break NZD/USD above the December 2018 high.
- A bearish divergence has formed with the RSI (Relative Strength Indicator).
- A large bearish candle has formed on H4 and threatened to break the trendline.
- The bias remains bearish beneath the December 2018 high, with support around 0.6875 and 0.6811 making likely bear targets.
Gold (XAU/USD): Gold Beaks Break Key Support
- After a long wait, gold prices finally fell through key support around 1850.
- Bears could seek to enter during a consolidation or continuation pattern on an intraday timeframe or seek to fade into minor rallies below the 1850 – 1859 resistance zone.
- Next major support is around 1800, so bears could target just above this key level. A break above the 1850 – 1859 resistance zone invalidates the bearish bias.
DJIA (US30): Bullish Engulfing Day Below Record Highs
- A bullish engulfing candle has respected the September high as support, which suggest a swing low could be in place.
- Bulls could consider entering with a break above Monday’s high, or seeking to enter on a retracement within yesterday’s range to help improve the reward to risk ratio.
- A break beneath Monday’s low invalidates the bullish bias. The initial target is 30,000 (prior highs and also just beneath the monthly R2 pivot) but bulls could also keep an open target with a break to new record high.
GBP/USD: Removed from watchlist. After a good bullish start, prices reversed late in the US session and the daily candle is now a shooting star, so we’d prefer to step aside for now.
USD/JPY: Removed from watchlist. Bullish momentum returned before prices broke beneath key support.
AUD/JPY: The bias remains bullish above 75.40 support and for a re-test of 77.00 – 77.09.
NZD/JPY: The bias remains bullish above the bullish engulfing low at 71.82.
CHF/JPY: Bullish momentum has returned and broken CHF/JPY out of its consolidation. The bias remains bullish above 114.20 and for a run towards the 115 highs.
USD/NOK: A break below 8.964 support assumes bearish continuation.
USD/SEK: We continue to wait for a break beneath 8.5527 support to signal a major breakout.