Macro Morning (oil rebounds)

Lucas_Oil_Gusher_Spindletop_Texas

by Chris Becker

Volatility is ruling the markets as the long expected rebound in oil outweighed the huge drop in US December retail sales, a significant breakdown in copper and continued speculation of what action, if any lasting, the ECB will take its meeting next week.

European stocks fell across the board, the FTSE falling the most down 2.3% while the DAX fell 1.2% but the technical daily picture looks better for the Germans:
Chart DAX30, D1, 2015.01.14 21:59 UTC, VantageFX Pty Ltd., MetaTrader 4, Real
As the FTSE remains in a sustained downtrend but has not yet broken weak support and the trendline from the pre-Christmas low:
Chart FTSE100, D1, 2015.01.14 22:00 UTC, VantageFX Pty Ltd., MetaTrader 4, Real
American stocks fared better, although the narrow Dow Jones fell 1%, the S&P500 was only down 0.6% as it bounced off support:

Chart SP500, H4, 2015.01.14 21:57 UTC, VantageFX Pty Ltd., MetaTrader 4, Real

SPI futures are now pointing to a 20 point plus loss on the ASX200 which has a similar technical picture to the US markets, with expected rises in energy stocks outweighed by falls in BHP and RIO, which had shocking nights on the LSE (down 5%):
Chart SPI200, H4, 2015.01.14 22:09 UTC, VantageFX Pty Ltd., MetaTrader 4, Real

So where is the good news? Well the long expected spike in oil finally happened, up nearly 6% on what looks like short exhaustion. This technical breakout will shift many speculative positions into longs and we could see a large upside here on WTI:

Chart CL-OIL, H4, 2015.01.14 21:49 UTC, VantageFX Pty Ltd., MetaTrader 4, Real
In currency land, King Dollar remains on his throne, somewhat elevated, as it meets its monthly decade high – more on this later:
dxymonthly
While euro was stable around the 1.18 handle, Cable (GBPUSD) made more inroads on its breakout now well above 1.52 with 1.56 the upside target:
Chart GBPUSD, H4, 2015.01.14 22:40 UTC, VantageFX Pty Ltd., MetaTrader 4, Real

The strengthening Yen broke through the 117 handle overnight before rebounding off its recent daily low:
Chart USDJPY, D1, 2015.01.14 22:42 UTC, VantageFX Pty Ltd., MetaTrader 4, Real
There is a potential swing long shaping here in USDJPY but all eyes will be on the Aussie today which briefly fell through the 81 handle overnight before sitting at its point of control at 81.50 this morning.

Finally, gold took a breather last night remaining at its daily highs and looking overbought at $1230USD an ounce, where a short swing is developing:

Chart XAUUSD, D1, 2015.01.14 22:45 UTC, VantageFX Pty Ltd., MetaTrader 4, Real
Data today in Asia will focus solely on the Australian unemployment release later this morning which should move the Aussie dollar significantly. Later tonight the focus will shift to the yearly German GDP print for 2014 and weekly initial jobless claims in the US.

 

 

 

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