Originally published AxiTrader
The rally in the Australian dollar is showing first signs of weakness. The resistance at the 76.8 % Fibonacci from the December high to the January low has proven to be strong, and the Aussie has been struggling to gain momentum. Furthermore, a general risk-off sentiment in global markets and concerns about a slowdown in China are adding further pressure on the currency. Should AUD/USD fail to clear the resistance at 0.72 soon, selling pressure may intensify. Traders might want to keep an eye on the 0.7085 level in that case – the next significant support level.
EUR/USD failed to extend gains after the recent break above 1.15, as weak data out of the Eurozone weighed on the currency. The support area between 1.1420 and 1.1440 is a crucial one for Euro bulls to watch, as it has acted as key support/resistance several times before. A clear break beneath could indicate a false breakout, and bring the euro under further pressure. The next key level to watch would then be 1.13. To the topside, EUR/USD needs to clearly leave the 1.15 level behind it for Euro bulls to regain confidence.
Silver is consolidating after a strong rally in December. Precious metals are benefiting from the risk-off sentiment, and as uncertainty is likely to remain high in the near-term, the short-term outlook for XAG/USD remains positive overall. Support at 15.50 has held, and Silver bulls are now awaiting a break above the triangle on the hourly charts. Stronger resistance can be expected at the $16 level.
WTI had a solid recovery in the past two weeks, but lost some of the momentum recently. The negative RSI divergence on the H4 chart hints at a correction in the short-term, and a break below $50 could trigger some profit-taking from short-term speculators. To the downside, $47.90-48.20 will be an area that oil bulls will be closely watching as it is the 50 % Fibonacci of the December rally, and also very close to the 21 DMA.
