17 July: Forecast: FX: US$/Majors: FXCharts

EURUSD: 1.1467
24 Hour Outlook: Neutral Medium Term: Prefer to buy dips.
Preferred 24-hour Strategy: NeutralEurUsd remained pretty much within its recent range on Friday, with most of the action to be seen through the crosses, and with the momentum indicators looking mixed a neutral stance is again required on Monday.  The daily charts may still be trying to build a topping formation so, in the near-term I still prefer to sell rallies with a stop placed tight above 1.1500. Further out though, this possibly looks unconvincing  as the ECB Meeting is due on Thursday, with expectations building that Mario Draghi may ramp up the rhetoric to begin tapering QE at the Sep 7 ECB Meeting, which would send the Euro sharply higher.

Technically, the initial support now lies nearby, at Friday’s low  (1.1390) and the 13 July low of 1.1370, below which could then run towards 1.1345/50 and then to 1.1310/15.

On the topside, the initial resistance will be seen at Friday’s high of 1.1470 and at 1.1485/90 ahead of 1.1500. Above here, only minor hurdles exist to stop the Euro from heading to the May 2016 high of 1.1616.

Resistance Support
1.1616 2 May 16 high 1.1425 Minor
1.1580 Minor 1.1390 Friday low
1.1535 Minor 1.1370 13 July low
1.1488 12 July high 1.1345 (38.2% of 1.1117/1.1489)
1.1471 Friday high 1.1310 5 July low

Economic data highlights will include:

M:  EU CPI (June), BuBa Monthly Report, New York State Empire Mfg Index

T: German/EU ZEW Economic Sentiment Survey, US NAHB Housing Market Index, Import/Export Index, API Weekly Crude Oil Stock Inventory

W: EU Construction Orders, Building Permits, Housing Starts EIA Crude Oil Stocks Weekly Change

T:  EU Current Account, ECB Meeting/Interest Rate Decision/Press Conference/Statement, US Jobless Claims, Philadelphia Fed Mfg Survey

F:



USDJPY: 112.52
24 Hour Outlook: Prefer to sell rallies Medium Term: Neutral -Look to buy dips @ 111.30/70
Preferred 24-hour Strategy: Mildly Bearish. Looking to sell towards/above 113.00 with a SL placed above 113.60.US$Jpy turned sharply lower on Friday, and after an early bid tone that saw the pair reach 113.57 it fell heavily following the US data to finish at 112.50, just above the lows of 112.25..

On the downside, while the hourlies are becoming oversold, the 4 hour/daily momentum indicators hint at lower levels ahead, and a break of 112.25 could bring about a decline to 112.00 ahead of a possible test of levels sub 111.70, but which should act as strong support if we get there. Below that, as we said before, the monthly cloud top is rising sharply and currently lies at 111.30, which should also see strong bids, but in the next 2 months will climb to 112.75 and then to 114.20 (Sept). We have not had a monthly close below the cloud top since Oct 2013.

On the topside, the daily charts look as though they are topping out, but if the hourlies do allow a bounce, then minor offers will arrive at various points ahead of  Friday’s high. This will again be strong resistance if/when we get there, but above which could revisit 113.80 ahead of 114.00. I don’t think we head up here for a while, but if wrong we could head back to the 114.49 trend high and further out, if we can take out the resistance seen at the 11 July high of 114.49, there is little to stand in the way of an attack on 115.00 and eventually higher.

Resistance Support
113.57 Friday high /200 HMA 112.30/25 (38.2% of 108.80/114.49) /Friday low
113.25 Minor 112.05 (38.2% of 108.12/114.49)
113.00 Minor 111.72 30 June low/100 DMA/200 DMA
112.85 Minor 111.30 (50% of 108.12/114.49)
112.70 Minor 110.98 (61.8% of 108.80/114.49)


GBPUSD: 1.3102
24 Hour Outlook: Prefer to buy dips Medium Term: Neutral
Preferred 24-hour Strategy: Mildly Bullish. prefer to buy dips with a SL placed under 1.3040.Having broken and closed above the triangle-top resistance of Friday, the momentum indicators are now looking more constructive, and buying dips appears to be the plan although Brexit issues will continue to create headwinds.

On the topside, good sellers will be seen right ahead, at 1.3120, but above which there is little to stop Cable heading on towards 1.3200 and then to 1.3280. Above there would be increasingly bullish, possibly opening up the major Fibo pivot at 1.3420 (50% pivot of 1.5017/1.1821) although this currently remains over the horizon.

On the downside, back below the recent trend high of 1.3047 could retest 1.3000, a break of which could have us quickly back at Friday’s low of 1.2933 although this seems unlikely today.

Resistance Support
1.3278 13 Sept high 1.3070 Minor
1.3200 Minor 1.3047 18 May high
1.3150 Minor 1.3000 Pivot
1.3120 Sept 2016 high 1.2970 Minor
1.3113 Friday high 1.2933 Friday low

Economic data highlights will include:

M:

T: CPI, PPI, RPI

W: Inflation Report Hearing

T: Retail Sales

F:



USDCHF: 0.9635
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: NeutralIt looked as though the SNB were quietly intervening on Friday, with the Chf notably weak in an otherwise steady market ahead of the US economic figures. US$Chf reached 0.9700, but then quickly reversed following the soft data and headed back towards the lower end of its recent range, but not getting close to testing the 0.9600 support and leaving the outlook pretty much unchanged.

The short term momentum indicators are mixed/flat and, on the downside, good support still lies at 0.9590/ 0.9600 although if this is taken out there is not too much to hold it up until 0.9550, where the 200 WMA has done a good job of propping the dollar up over the last couple of weeks. Below there would be a longer term concern for the dollar and could see a run back to previous, 2016 lows at 0.9520/30, to 0.9500, and potentially a fair bit lower.

On the topside, the dollar did its best on Friday to take out the nearby resistance, although 0.9700 once again proved a significant hurdle that is yet to be overcome. If taken out, then we could quickly head toward 0.9730 and then to 0.9745 although I don’t see it up here today.

More choppy trade looks likely within the 0.9600/0.9700 range, possibly until the ECB on Thursday. If anything I mildly prefer to trade from the short side but not convinced, especially if the SNB are underpinning the dollar.

Resistance Support
0.9760 (38.2% of 1.0099/0.9555) 0.9628 Friday low
0.9730 Descending trend resistance 0.9615 13 July low
0.9700 Friday high 0.9601 12 July low
0.9785 Minor 0.9591 7 July low
0.9665 Minor 0.9555/52 3 July low/29 June low /200 WMA


AUDUSD: 0.7826
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: NeutralThe Aud moved parabolically higher on Friday following the US data, after having looked bid all day long, reaching the 12 month high of 0.7835, where we now have a double top. The momentum indicators are generally all pointing higher although the short term charts are at overbought extremes and caution is warranted at these levels. Given that we are now also up against major Fibo resistance, it may be worth selling at Friday’s closing levels, with a tight SL placed above 0.7850, for a short term trade, but the longer term charts are looking increasingly positive, and if the US data remains soft, we are likely to see higher levels in the days/week’s ahead. Above 0.7835 could then open the way towards 0.7900/75 and to 0.8000+.

Short term support lies at 0.7800 and back below there could see a return to 0.7775, where the Aud will find decent support. The charts certainly look positive although I am loathe to buy the Aud up here, and the RBA certainly will not be comfortable at these levels. It does look though as if 0.8000+ may lie ahead.

Resistance Support
0.7975 200 MMA 0.7800 Minor
0.7935 Minor 0.7775 Minor
0.7900 Minor 0.7750 Minor
0.7850 Minor 0.7725 Friday low
0.7835/33 7 July 2016 high/Friday high/(23.6% of 1.1082/0.6826) 0.7715 (23.6% of 0.7327/0.7834)

Economic data highlights will include:

M:  China Retail Sales, Industrial Production, Urban Investment (All June), GDP (Q2), Press Conference

T:  New Motor Vehicle Sales, China House Price Index, RBA Minutes

W:  WBC Leading Economic Index

T:  NAB Business Conditions/Confidence (Q2), Unemployment

F:



NZDUSD: 0.7346
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy:  Neutral.The Kiwi had a choppy session on Friday, falling to 0.7298 in Europe before spiking up to 0.7365 after the US data, again falling just a few points short of the Feb high of 0.7375. The short term momentum indicators are mixed but he 4 hour charts do point higher, and we could yet see a run back to the highs although I would be doubtful of heading much above 0.7375 today unless the NZ CPI figure, due shortly, is very strong. The dailies look less certain about this move up, and on the downside the initial support still lies at 0.7300 ahead of 0.7270/80 and the 13 July low of 0.7245. The NZ CPI is coming up shortly and may provide something directional and then tomorrow we get the fortnightly Global Dairy Trade Index.
                                         Resistance             Support
0.7485 7 Sept high 0.7320 Minor
0.7402 8 Nov high 0.7298 Friday low
0.7375 7 Feb high 0.7275 200 HMA
0.7365/68 Friday high/13 July high 0.7246 13 July low
0.7350 Minor 0.7201 11 July low

Economic data highlights will include:

M:  CPI (Q2),

T:  Global Dairy Trade Index

W:

T:

F:  NZ Visitor Arrivals

By | July 17, 2017
Source: FXCharts

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