INTRADAY TECHNICAL ANALYSIS 17 FEBRUARY (observation as of 07:00 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.14990 and 1.15699.

-        Support line of 1.12697 and 1.11989.

Commentary/ Reason:

  1. The euro slipped as far as 0.4% earlier in the day, before recovering slightly to trade at $1.13542.

  2. The dollar bounced after a Russian news report of mortar fire in eastern Ukraine sent investors worried about a wider war scurrying for safety.

  3. The ongoing Russia-Ukraine tensions keep weighing on the euro after NATO Secretary-General Stoltenberg said there is no indication yet that Russia has pulled troops back from the Ukraine border.

  4. The expectation of an aggressive Fed hike cycle keeping a base for the dollar in place.

  5. The EURUSD has begun to bounce back after a short-term sell-off lost steam, though momentum currently appears subdued and insufficient to drive the break, which a rally towards 1.149 will be on the cards. And if bulls keep insisting, then the 1.156 psychological barrier will come into the picture. The 14-day RSI remains flat but above the midline, supporting the bullish view.

EURUSD

 

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.92632 and 0.92854.

-        Support line of 0.91916 and 0.91694.

Commentary/ Reason:

  1. The dollar was flat against the Swiss franc, traded at 0.92224 franc and hovering just above the 1-week low recorded overnight.

  2. The USD/CHF retreats from 0.9260 top, approaching the bottom of the range, courtesy of risk-off market mood. The U.S. dollar licks its wounds amid sluggish Treasury yields, as traders refrain to place any fresh directional bets.

  3. While new development in geopolitical tensions between the West and Russia kept the safe haven Swiss franc to hold its ground.

  4. The Swiss National Bank remains committed to its ultra-loose monetary policy, as the latest labor data indicated that unemployment did not increase despite the COVID-19 infection wave in January, while consumer inflation remains moderate.

USDCHF

 

[USDJPY]

Important Levels to Watch for Today:

-        Resistance line of 115.978 and 116.459.

-        Support line of 115.016 and 114.535.

Commentary/ Reason:                                        

  1. The Japanese yen traded at 115.307 per dollar, stronger than levels above 115.6 seen against the greenback yesterday.

  2. The greenback retreated after U.S. Treasury extended their decline on Thursday, pressured both by bets for a less hawkish Fed and as ongoing Russia-Ukraine tensions boosted the safe-haven demand for the yen. 

  3. The USDJPY pair has stalled at the current range, indicating that neither buyers nor sellers have the appetite to drive a trend change. Momentum indicators have flattened in bullish territory. Geopolitical headlines dominated market mood.

USDJPY

 

[GBPUSD]

Important Levels to Watch for:

-        Resistance line of 1.36132 and 1.36380.

-        Support line of 1.35328 and 1.35080.

Commentary/ Reason:

  1. Sterling traded at $1.35922 on Thursday.

  2. Rate hikes expectation are supporting the British pound, after data on Wednesday showing British consumer prices rose at the fastest annual pace in nearly 30 years, intensifying the squeeze on households and reinforcing the chances that the Bank of England will raise interest rates for a third meeting in a row.

  3. The BoE is expected to raise rates by a further 25 basis points at its March meeting. That would be the first time the Bank has raised rates at three meetings in a row since 1997.

  4. Gains in pair, however, were limited by ongoing Russia-Ukraine tensions after NATO Secretary-General Stoltenberg said there is no indication yet that Russia has pulled troops back from the Ukraine border.

GBPUSD