Daily Report on January 11, 2017
Asian shares surged to two-month highs while European equities opened flat on Wednesday ahead of President-elect Donald Trump's news conference later in the day. Investors will be looking for clues on policies on taxes, fiscal spending, international trade and currencies under the new administration as Trump's election campaign has already called for tax cuts and more infrastructure spending, which helped boosted U.S. shares and the dollar.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.5%, led by South Korean shares that hit a 1-1/2-year peak. The gains in Kospi Index in Seoul were thanks to Samsung Electronic - Asia's biggest company by market cap whose shares were spurred by solid earnings published last week. Meanwhile, Japanese benchmarks edged higher, curbing three days of losses.
Australia’s S&P/ASX 200 Index and New Zealand’ S&P/NZX 50 Index rose on the back of strong miners and technology shares. Hong Kong’s Hang Seng Composite Index looked set for a 10th day of gains and the longest winning run since 2012 with a 0.5% rise.
Crude prices recovered from more than one-month lows recorded Tuesday. Oil slumped further after the American Petroleum Institution late Tuesday reported that U.S. crude supplies added 1.5 million barrels for the week ended Jan. 6. The U.S. Energy Information Administration (EIA), which is scheduled to release its latest figures on Wednesday, stated that American crude production would rise by 110,000 barrels per day (bpd) to 9 million bpd in 2017.
The up moves on Wednesday came amidst mounting reports of Saudi supply cuts. Saudi Arabia, the world's top oil exporter, was reported to cut crude supplies slightly from contracted volumes in February, including to India and Malaysia.
Fig: EURAUD H4 Technical Chart
EURAUD has breached the major support at 1.43000 after two days of declines. The pair continued to be under downward pressure from the short-term MA20 and is heading towards another support at 1.42200. RSI has nearly reached the oversold territory while ADX is soaring with a wide gap between +DI and –DI lines.
Buy Digital Put Option from 1.42800 to 1.42200 valid until 20:00 GMT January 11, 2017
Fig: AUDUSD H4 Technical Chart
After a period of moving sideways, AUDUSD finally broke out of the range and ticked higher. The pair has been supported by the short-term 20-period moving average which may send the pair to the resistance at 0.74250. The level prevented the price from surging higher nearly one month ago.
Buy Digital Call Option from 0.73850 to 0.74250 valid until 20:00 GMT January 11, 2017
Fig: BRENT H4 Technical Chart
As indicated by the RSI indicator chart, Brent crude fell into the oversold market yesterday after a steep decline and is struggling to find the way back. The commodity recovered from as low as 53.57 due to a correction and is expected to retest the resistance at 54.35.
Buy Digital Call Option from 53.90 to 54.35 valid until 20:00 GMT January 11, 2017
Fig: CAC40 Index H4 Technical Chart
CAC 40 index has been on a sharp down move which helped bring the price action below both the short-term and long-term moving averages. The index was trapped between two MAs before breaking lower the long-term MA50 which may indicate a reversal into a downtrend. The support at 4825.00 is within the sight.
Buy Digital Put Option from 4855.00 to 4825.00 valid until 20:00 GMT January 11, 2017