Weekly Recap 26th November – 2nd December ’16

The  last week of November and the first days of December were dominated by the OPEC this year. The oil cartel curbed its production, marking the first such move since 2008 and the financial crisis. The first days of the week were highly volatile with the Japanese Yen remaining the weakest among the majors. The Dollar drifted lower against most of its peers, while the Euro and the Great British Pound gained ground during the period. The Aussie and the Kiwi were among the weaker currencies, while the Canadian Dollar benefited the most from the huge spike in the price of oil. Gold continued to struggle all week long, while industrial commodities held on to their prior gains.

 

Let’s see how the most important pairs performed this week!

EUR/USD:

The week in numbers

The Euro had a narrow range week once again as it remained above its long-term lows and finished the period at 1.0592with a small gain of 56pips or 0.52%, from an opening rate of 1.0592 The cross had a 111-pip weekly range, with a low of 1.0571 and a weekly high of 1.0682. The pair closed the week below the 161.8% Fibonacci extension level at 1.0780.

Fundamentals 

The Euro consolidated throughout the week, as the better than expected Eurozone reports helped the common currency in correction higher. The Dollar experienced a broad correction against its most important peers. The Eurozone Services and Manufacturing PMIs and the German retail Sales number were the most bullish for the Euro last week, with the hawkish tone of the ECB also boosting the value of the currency in the second half of the period.

Technical picture

The Euro still trades in short-term downtrend, despite the recent correction, as the 1.0475 support level remains in danger.Strong resistance is still found at 1.0850, near 1.10 and above that at 1.1185, while support is at the current level near 1.0550 and around 1.0475. The MACD and the short-term Stochastic are both neutral going into the weekend.

Trading Range: 1.1000 – 1.0475

 eurusdh1_12_03

Weekly Support & Resistance Levels

R3: 1.0805

R2: 1.0721

R1: 1.0689

Pivot Point: 1.0636

S1: 1.0605

S2: 1.0551

S3: 1.0467

GBP/USD:

The week in numbers

The Pound had a strongly bullish week, breaking above the 1.25 level and finishing near the highs on a new rally high at calm consolidation week after a bullish Monday, at 1.2650 for a large gain of 258pips or 2.05%, from an opening price of 1.2392. Cable had a wide weekly range of 308 pips with a low of 1.2386 and a high of 1.2694. GBP/USD closed the week just below the 261.8% Fibonacci extension level at 1.2785 on Friday.

Fundamentals

The Pound remained relatively strong amid the broad decline in the Greenback, as the oversold technicals continue to help the currency, together with the bullish implications of the U.S. presidential election. The British Manufacturing PMI was worse than expected in November and the Bank Stress Test results were also disappointing, but Cable still climbed higher during the week.

Technical picture

The pair traded exited a narrowing consolidation pattern towards the end of the week, possibly starting a new leg higher in the short-term uptrend, following the U.S. election. Crucial support is now found at 1.25 and below that at 1.2350 with strong resistance near 1.2750 and at 1.2850. The MACD and the short-term Stochastic are both overbought going into the weekend.

Trading Range: 1.2900 – 1.1900

 gbpusdh1_12_03

Daily Support & Resistance Levels

R3: 1.2984

R2: 1.2789

R1: 1.2689

Pivot Point: 1.2594

S1: 1.2495

S2: 1.2400

S3: 1.2205

USD/JPY:

The day in numbers

The pair continued its clear uptrend this week although it finished on a bearish note after the NFP releases at 113.63 with a small gain of 60 pips or 0.56% after opening at 113.03. The cross hit a weekly high of 114.77 and a low of 111.35 for a wide weekly range of 342 pips. The cross closed the week well above the full Fibonacci retracement level at 105.50 again on Friday.

Fundamentals 

The Yen remained the weakest major currency for another week, as it lost ground even to the weaker U.S. Dollar during the period. The pair rose as high as 115 for the first time since 2015, as the divergent central bank policies continue to hurt the Yen. The OPEC deal also pushed the pair higher, as the Japanese economy is sensitive to commodity exports. The slight rebound in the regional currencies somewhat stabilized the cross in the second half of the week. More weakness is expected in the Yen if rate hike odds remain high regarding the next FED meeting.

Technical picture

The pair shot higher to a new rally high before correction back to the lower boundary of the dominant bullish trend channel on Friday. The steep uptrend still remains intact. Support is still found near the 110 level, at 108.50, and at 107.40. Resistance now lies ahead around 113.50, and above that near 115.00.The MACD and the short-term Stochastic are both neutral going into the weekend.

Trading Range: 115.50 – 105.50

   usdjpyh1_12_03

Weekly Support & Resistance Levels

R3: 116.21

R2: 115.22

R1: 114.64

Pivot Point: 114.22

S1: 113.64

S2: 113.23

S3: 112.24

AUD/USD:

The week in numbers

The Aussie had a choppy and flat week, as it fell sharply in the middle of the period before finishing on a bullish note at 0.7445, for a small gain of 8 pips or 0.09% after opening at 0.7437. The pair had a wide weekly trading range of 126 pips with a high of 0.7497 and a low of 0.7371. The cross finished the week just below the 38.2% Fibonacci support level at 0.7452 on Friday.

Fundamentals 

The Aussie had a mixed week, as it continued its upward correction in the beginning of the period, but became surprisingly weak after the favorable OPEC deal. The huge negative surprise in Building Approvals pushed the currency below the 0.74 level once again, despite the broad weakness of the Dollar. Retail Sales came in better than expected on Friday, but that failed to change the underlying bearish trend in the pair. All eyes are still on the Federal reserve’s next move and the health of the Asian economies.

Technical picture

The pair exited a triangle consolidation formation on Wednesday and re-tested the lower boundary of the pattern on Friday after a sharp rally. The pair is still stuck between strong support and resistance zones, within a narrow trading range. Crucial support is still found near 0.7400, at 0.7350 and around the 0.7250 level. Strong resistance is now ahead near the current rate at near 0.7450, and above that at 0.7500. The MACD and the short-term Stochastic are both neutral going into the weekend.

Trading Range: 0.7750 – 0.7150

 audusdh1_12_03

Weekly Support & Resistance Levels

R3: 0.7504

R2: 0.7452

R1: 0.7433

Pivot Point: 0.7400

S1: 0.7381

S2: 0.7349

S3: 0.7297

USD/CAD:

The week in numbers

The pair had a strongly bearish week following a long topping period as it crashed lower towards the end of the period and finished at 1.3288, with a large lossof235 pips or 1.78%, from an opening price of 1.3523. The cross traded in a wide 288-pip range with a weekly high of 1.3538 and a low of 1.3250. The pair finished the week still above the full retracement level at 1.3185 on Friday.

Fundamentals 

The Canadian Dollar got a huge boost this week from the sharp rise in the price of oil after the historical OPEC deal regarding a production cut by the cartel. Russia also joined the deal which helped the Loonie in turning higher after a fairly long bearish period. The monthly GDP print was also a positive surprise while the Employment Report on Friday was much better than expected, sending the currency even higher. If oil manages to climb even higher, the pair could stabilize below the 1.35 level.

Technical picture

The pair fell below the lower boundary of a slightly declining trend channel towards the end of the week, as the strength of the Loonie pushed it lower, helped by the rally in oil.Crucial support is now found at the 1.3185 level and around 1.3015. Strong resistance is ahead at 1.3385, at 1.3450, and near 1.3550. The MACD is oversold while the short-term Stochastic is neutral going into the weekend.

Trading Range: 1.3750 – 1.3015

 usdcadh1_12_03

Weekly Support & Resistance Levels

R3: 1.3628

R2: 1.3489

R1: 1.3403

Pivot Point: 1.3351

S1: 1.3265

S2: 1.3213

S3: 1.3075

Economic Data Release

Note: All times are in GMT.

   

 

Date

Currency

Event

Time

4-Dec Sun

AUD

AiG Performance of Service Index

22:30

 

JPY

Loans & Discounts Corp (YoY)

23:50

 

AUD

TD Securities Inflation (MoM)

00:00

 

JPY

Nikkei Japan PMI Composite

00:30

 

AUD

Company Operating Profit (QoQ)

00:30

 

AUD

ANZ Job Advertisements (MoM)

00:30

 

JPY

Nikkei Japan PMI Services

00:30

 

AUD

Inventories

00:30

 

JPY

BOJ Kuroda speaks in Tokyo

03:45

5-Dec Mon

JPY

Consumer Confidence Index

05:00

 

EUR

Markit/ADACI Italy Services PMI

08:45

 

EUR

Markit/ADACI Italy Composite PMI

08:45

 

EUR

Markit France Services PMI

08:50

 

EUR

Markit France Composite PMI

08:50

 

EUR

Markit Germany Services PMI

08:55

 

EUR

Markit/BME Germany Composite PMI

08:55

 

GBP

New Car Registrations (YoY)

09:00

 

EUR

MarkitEurozone Services PMI

09:00

 

EUR

MarkitEurozone Composite PMI

09:00

 

GBP

Markit/CIPS UK Services PMI

09:30

 

GBP

Markit/CIPS UK Composite PMI

09:30

 

EUR

Euro-Zone Sentix Investor Confidence

09:30

 

EUR

Euro-Zone Retail Sales (MoM)

10:00

 

USD

Fed’s Dudley Speaks

13:30

 

USD

Fed’s Evans Speaks

14:25

 

USD

Markit US Services PMI

14:45

 

USD

Markit US Composite PMI

14:45

 

USD

Labor Market Conditions Index Change

15:00

 

USD

ISM Services/Non-Manufacturing Composite

15:00

 

AUD

ANZ Roy Morgan Weekly Consumer Confidence Index

22:30

 

JPY

Labor Cash Earnings (YoY)

00:00

 

AUD

Current Account Balance

00:30

 

AUD

Reserve Bank of Australia Rate Decision

03:30

6-Dec Tue

EUR

German Factory Orders s.a. (MoM)

07:00

 

EUR

Markit Germany Construction PMI

08:30

 

EUR

Markit Germany Retail PMI

09:10

 

EUR

MarkitEurozone Retail PMI

09:10

 

EUR

Markit France Retail PMI

09:10

 

EUR

Markit Italy Retail PMI

09:10

 

EUR

Euro-Zone Gross Domestic Product s.a. (QoQ)

10:00

 

USD

Trade Balance

13:30

 

USD

Non-Farm Productivity

13:30

 

CAD

International Merchandise Trade

13:30

 

USD

Unit Labor Costs

13:30

 

CAD

Ivey Purchasing Managers Index s.a.

15:00

 

USD

Factory Orders

15:00

 

USD

Durable Goods Orders

15:00

 

USD

IBD/TIPP Economic Optimism

15:00

 

AUD

AiG Performance of Construction Index

22:30

 

AUD

Gross Domestic Product (YoY)

00:30

7-Dec Wed

JPY

Leading Index

05:00

 

JPY

Coincident Index

05:00

 

EUR

German Industrial Production s.a. (MoM)

07:00

 

GBP

Halifax House Price (3MoY)

08:30

 

GBP

Industrial Production (MoM)

09:30

 

GBP

Manufacturing Production (MoM)

09:30

 

USD

MBA Mortgage Applications

12:00

 

GBP

Bank of England Bond Buying Operation

14:50

 

CAD

Bank of Canada Rate Decision

15:00

 

USD

JOLTS Job Openings

15:00

 

USD

DOE U.S. Crude Oil Inventories

15:30

 

USD

Consumer Credit

20:00

 

JPY

Current Account Total (Yen)

23:50

 

JPY

Trade Balance

23:50

 

JPY

Gross Domestic Product (QoQ)

23:50

 

JPY

Bank Lending(YoY)

23:50

 

EUR

Germany First Quarter Manpower Employment Outlook

 

 

JPY

Bankruptcies (YoY)

 

 

JPY

Eco Watchers Survey

 

 

AUD

Trade Balance

00:30

 

JPY

Tokyo Avg Office Vacancies

02:00

8-Dec Thu

EUR

European Central Bank Rate Decision

12:45

 

EUR

ECB Asset Purchase Target

12:45

 

CAD

Housing Starts

13:15

 

CAD

Capacity Utilization Rate

13:30

 

CAD

New Housing Price Index (MoM)

13:30

 

CAD

Building Permits (MoM)

13:30

 

USD

Initial Jobless Claims

13:30

 

USD

Continuing Claims

13:30

 

USD

Household Change in Net Worth

17:00

 

JPY

Japan Money Stock

23:50

 

JPY

BSI Large All Industry (QoQ)

23:50

 

JPY

Machine Tool Orders (YoY)

 

 

AUD

Home Loans

00:30

 

AUD

Investment Lending

00:30

9-Dec Fri

 

 

 

 

EUR

Labor Costs WDA (YoY)

07:00

 

EUR

German Trade Balance (euros)

07:00

 

EUR

German Current Account (euros)

07:00

 

GBP

Trade Balance

09:30

 

GBP

Construction Output s.a. (YoY)

09:30

 

USD

Wholesale Inventories

15:00

 

USD

U. of Michigan Confidence

15:00

 

USD

Baker Hughes U.S. Rig Count

18:00