The score for US durable goods orders fell in February. The index fell to negative zone around 1.4% against positive 2.0% in February. Rising USD is the main reason for this unexpected fall. FOMC member Lockhart testifies, "economic conditions are likely to evolve in a way such that it will be appropriate to hold off on raising short-term rates until 2016. Economic activity appears to be on a solid, sustainable growth path. However, inflation is low and is expected to remain low for some time and I have serious concerns that inflation will run even lower than I expect. We wait too long to raise rates, and subsequently, inflation picks up faster than the projected gradual path to 2 percent. Given how far inflation is from our target, some greater-than-expected pickup in inflation would actually be welcome".
The pair rebounded after the fall on Tuesday. The pair managed to close twice above 50Dsma over a day. The pair has been making lower tops for 3 days in a row. It's not a good sign for the near term. This view is not valid in case the price gets above 1.2550. Bbulls might regain the strength in case price closes above 1.2600. The pair prepared a strong support base between 1.2350 and 1.2300 at 200MSMA. Until prices close above 1.2300, buying on dips still remains in play. Weekly resistance is found at 1.2575 and intraday resistance is seen at 1.2550. On the h1 chart, lower lows and lower highs are used to develop. Now, the trend is being changed towards higher lows and higher highs. We expect an intraday strong reversal above 1.2550 towards 1.2610 and 1.2650. The near-term picture favors bears. We have been expecting the price to correct towards 1.2400 or 1.2370. However, it formed a low at 1.2428. From there, the pair changes its direction. Until the price closes below 1.2575, selling on rise is likely to be preferable. We are bullish in a longer term, but the near-term outlook favors mild-correction. Intraday support is found at 1.2475 and 1.2425. Today, safe intraday trade is not available. I advise traders to wait patiently for a day.
Trade: Risky trade buying above 1.2550
The pair managed to hold at 50Dsma closed above that. Ahead of the today's data from the US, the pair is trading with a negative bias. Intraday support is likely to be found at 119.18. Resistance is seen at 119.90 and 120.40. We recommend buying with SL at 118.75. This view is valid for this week. Bulls must close above 120.00 to take charge. Until then, the trading range pattern is framed between 118.90 and 120.40. The support zone is likely to be ser arount 119.18, 118.75, and 117.50. A daily close below 117.50 leads to another leg down towards 116.00 and 115.00. Bulls are safe, until the price closes above 117.50 100Dema.
The key level for bulls to close above to take charge:
USD/CAD at 1.2575, USD/JPY at 120.00, USD/CHF at 0.9730.
Uitgevoerd door, Analytische expert
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