21 Nov: Forecast: FX: US$/Majors + trade ideas: FX Charts

EURUSD: 1.1730
EurUsd had a choppy range of 1.1721/1.1807 care of the German political standoff, leaving Angela Merkel with the possibility of facing new elections.Focus will again be on Germany today, to see what the next direction will be, and that is likely to weigh on the downside although with the momentum indicators looking mixed it could be another session within the 1.1700/1.1800 range. As we said yesterday, with a fairly limited calendar this week, it looks as though it will be politics and risk sentiment that will continue to guide the action, although the FOMC Minutes may provide something directional on Wednesday.

The short term momentum indicators still look a little heavy and we might see another test of the 1.1721 low, below which could allow a decline towards 1.1700, below which 1.1670/80 would attract. This was the previous H/S neckline and is also the 61.8% Fibo level (1.1670) of the recent rally from 1.1553, and should see decent bids but below which opens the way to 1.1650 and eventually to 1.1625. Having closed back below the 100 DMA (1.1745), I suspect the downside will eventually come good, and today, selling at this level may be a plan.

On the other hand, the daily MACDs still suggest that further gains are possible in the days ahead, and back above the session high of 1.1807 would open up 1.1820/30, which would find good sellers ahead of 1.1855/60 and again at 1.1880/85, beyond which would allow a run towards 1.1900+.

Preferred Strategy:  For Tuesday, I prefer to adopt a fairly neutral stance in the absence of any major data but with one eye on headlines from Germany. Out of choice I would look to sell into strength above 1.1745, perhaps towards 1.1780, with a SL placed above 1.1830.

Sell EurUsd @ 1.1770. SL @ 1.1830, TP @ 1.1740.

24 Hour: Neutral -Mildly Bearish Medium Term: Neutral – Prefer to sell rallies
FX Charts Position: Short  – SL  above 1.1880
Resistance Support
1.1857/59 20 Oct high/16 Nov high 1.1735 100 DMA
1.1828 Daily cloud base 1.1721 Session low
1.1821 17 Nov high 1.1690 Minor
1.1807 Session high 1.1671 (61.8% of 1.1553/1.1859)
1.1745 100 DMA 1.1660 14 Nov low

Economic data highlights will include:

EU Financial Stability Report, Chicago Fed National Activity Index, US Existing Home Sales  , API Weekly Crude Oil Stock Inventory

USDJPY: 112.63
US$Jpy had a more positive session on Tuesday as risk sentiment improved, holding on above decent support below 112.00 and slowly squeezing up to a high of 112.70The short term momentum indicators are looking positive today and on the topside, resistance on Tuesday will be seen at 112.70, ahead of 113.00, a break of which could see the dollar head back towards  113.15 and possibly on to 113.30.

The daily momentum indicators are still pointing lower though and we could see another run to levels below 112.00, although decent support lies in the 111.50/70 area where it might be worth trying buy some dollars if we ever see it down there..

Preferred Strategy:  Support today will arrive at 112.20/112.00 and I doubt that we go under here today, and overall I suspect we may be in for a couple of days of 112/113 range trading.

In the longer term I still prefer to look to buy the dollar but prefer to wait until we see 112.00/111.50.

Buy US$Jpy @ 112.15. SL @ 112.40, TP @ 113.50

24 Hour: Neutral – Prefer to buy dips? Medium Term: Neutral
FX Charts Position: Flat
Resistance Support
113.65 (61.8% of 114.73/111.87) 112.05 200 WMA
113.33 15 Nov high/(50% of 114.73/111.87) 111.87 Session low
113.14 17 Nov high/200 HMA 111.75 200 DMA/100 DMA
112.95 (38.2% of 114.73/111.87) 111.46 25 Sept low/Daily cloud top
112.70 Session high 111.00 (50% of 107.31/114.73)

Economic data highlights will include:                                      

All Industry Activity Index

GBPUSD: 1.3232
Sterling traded up to 1.3279 in Europe, assisted by reduced Brexit fears and the German political angst but has since given back a few of the gains and currently sits in the middle of the day’s range (1.3185/3279).Overall, the momentum indicators are still in neutral gear, so a nimble stance is required, but on balance I still think Cable could grind higher in the days ahead. Any negative Brexit headlines could quickly alter that theory and would see a rapid move to the downside, but for Tuesday, further choppy trade near current levels would not really surprise.

On the topside, resistance will again be seen at 1.3260, above which 1.3275/1.3300 would find good offers although I doubt we see it much above here today.

On the downside, support will be now seen at 1.3185, 1.3150 and at 1.3135 ahead of the rising trend support low at 1.3100.

Preferred Strategy:  I remain neutral, possibly very cautiously bullish (Long GbpAud), and as long as we don’t see a daily close below 1.3165, which would negate the series of higher highs/lows, I will stick with the mildly bullish tone.

24 Hour: Neutral  -Prefer to buy dips Medium Term: Neutral
FX Charts Position: Flat (Long GbpAud)
Resistance Support
1.3320 1 Nov high 1.3210 100 WMA
1.3300 Minor 1.3185 Session low
1.3279 Session high 1.3150 200 HMA
1.3260 Daily cloud top 1.3134 16 Nov low
1.3230 Minor 1.3090 Rising trend support

Economic data highlights will include:                                                                

Public Sector Net Borrowing Requirements, Inflation Report Hearing, CBI Distributive Trade Survey – Orders

USDCHF: 0.9934
US$Chf had a bid tone through European/US trade, and is closing near session highs of 0.9934.The 4 hour and daily momentum indicators are now pointing a little higher and further upside momentum could be on the cards although I do not expect too much action unless the Euro starts to move on political headlines from Germany. If so, on the topside, resistance will be seen immediately ahead, at 0.9935/45, beyond which could see a move back to parity although probably not today

Further out, given the positive look of the weeklies, if we can eventually take out 1.0015/25 we could then head on to take another look at 1.0035/40, above which there is little to hold the dollar up ahead of 1.0100, and beyond that to 1.1025 and 1.0170.

On the downside, support will be seen today at 0.9900, below which could revert to the session low at 0.9878 although I don’t think we get there. If wrong look for a move back below 0.9875 to where further support would been at 0.9845 and 0.9800/10.

Preferred Strategy:  Buy US$Chf @ 0.9900. SL @ 0.9870, TP @ 1.0015

24 Hour: Mildly Bullish – Prefer to buy dips Medium Term: Prefer to buy dips
FX Charts Position: Long – SL @ 0.9840.
Resistance Support
1.0037 27 Oct high 0.9879/78 16 Nov low / 17 Nov low/Session low /Rising trend support
1.0017 9 Nov high 0.9845 15 Nov low/100 WMA
0.9986 13 Nov high 0.9810 200 DMA
0.9940 16 Nov high /17 Nov high 0.9800 (38.2% of 0.9420/1.0037)
0.9933 Session high 0.9785 Minor

Economic data highlights will include:

Trade Balance

By | November 21, 2017
Source: FXCharts

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