EURUSD: 1.1167 |
The Euro has, for the time being, bottomed out at 1.1126 in a relatively tight day’s trade.
With the short term momentum indicators now looking a little more constructive we could see a near term squeeze to the topside and above the session high would open the way back towards 1.1185 and the 19 June high of 1.1212.
The immediate support now arrives at 1.1125 beyond which would allow a move to 1.1100/10 and possibly to 1.1065/75 and 1.1015 although possibly not yet.
As before, while the dailies point lower, selling rallies towards 1.1200, with a SL placed above 1.1230 seems to be the plan for Thursday. Politics would seem likely to provide the direction in the absence of any major data on Thursday, apart from the US House Price Index, and it could end up being another tight session.
24 Hour: Mildly Bullish – Prefer to sell rallies | Medium Term: Mildly Bearish | ||
Resistance | Support | ||
1.1253 | (76.4% pivot of 1.1295/1.1118) | 1.1118 | 20 June low |
1.1228 | (61.8% pivot of 1.1295/1.1118) | 1.1108 | 30 May low |
1.1212 | 19 June high | 1.1075 | 18 May low |
1.1185 | (38.2% of 1.1295/1.1118) | 1.1067 | (23.6% of 1.0340/1.1295) |
1.1168 | Session high | 1.1017 | (38.2% of 1.05701.1295) |
Economic data highlights will include:
EU Economic Bulletin, US Jobless Claims, House Price Index, Kansas Fed Mfg Activity, EU Consumer Confidence
USDJPY: 111.37 |
US$Jpy has had a choppy day, trading between 111.06/73 but ultimately is pretty much unchanged at the end of the session on Wednesday.
The 4 hour/daily momentum indicators are now mixed and a similar session ahead would not really surprise. The dailies remain positive though, and above the session high of 111.73 would find sellers at 111.82/90, which should be decent resistance, but beyond which could head towards 112.15/20.
The downside will again find bids at around 111.00/10, below which could see a return to 110.65/75 although this seems unlikely today, but a break of which would then head towards 110.30 and possibly back to 110.00.
A neutral stance with a mild bias towards buying dips still seems to be the plan.
24 Hour: Neutral | Medium Term: Prefer to buy dips | ||
Resistance | Support | ||
112.50 | Minor | 111.06 | Session low |
112.22 | (61.8% of 114.36/108.80) | 110.90 | (23.6% of 108.80/111.59) |
112.12 | 24 May high/Daily cloud top | 110.72 | 19 June low /200 DMA |
111.90/82 | 100 DMA /Daily cloud base | 110.64 | 16 June low |
111.78 | 20 June high | 110.05 | 200 HMA /Weekly Tenkan |
GBPUSD: 1.2672 |
Sterling is very choppy while the BOE MPC cannot make up their collective mind over the future direction of policy, with Haldane today contradicting Carney’s outlook of the previous session. Cable bounced sharply from the 1.2588 lows following his hawkish outlook, reaching 1.2709
Technically, the outlook remains much the same and I think there are easier things to trade, as the choppy price action looks set to continue, dominated by political statements.
The topside will again see sellers at 1.2700/10 above which could then run towards 1.2760/70 and above that, towards the 1.2800/17 area, which capped it last week.
On the downside the 100 DMA may act as a near term pivot ahead of the next area of support at around 1.2580/90. I doubt that we head much below here today but further support would arrive at 1.2550 and at 1.2514, which was the low seen on the announcement of the election in April. Below that would head towards 1.2465/70 although that remains some way off.
Neutral.
24 Hour: Neutral | Medium Term: Mildly Bearish | ||
Resistance | Support | ||
1.2800 | Minor | 1.2635 | Minor |
1.2763 | (38.2% of 1.3047/1.2588) | 1.2622 | 100 DMA |
1.2725 | 200 HMA | 1.2582/88 | Session low/(50% pivot of 2197/1.3047) |
1.2709 | Session high | 1.2550 | 200 DMA |
1.2695 | (23.6% of 1.3047/1.2588) / | 1.2515 | Minor |
Economic data highlights will include:
CBI Distributive Trade Survey – Orders
USDCHF: 0.9723 |
US$Chf had a tight inside day, trading a range of 0.9723/53, and in the short term a neutral stance is required.
If we do see further gains, above today’s high of 0.9753 and last Thursday’s high of 0.9770 would allow a run towards 0.9800/07. Beyond there opens the way to 0.9825 and possibly higher, towards 0.9850 and eventually to 0.9915
On the downside, the initial support will arrive at 0.9720 and again at the 19 June low of 0.9695, although this looks a little doubtful to be seen again on Tuesday. Below their though would see a move back to 0.9675 and then towards the 100 MMA/14 June low which would provide strong support.
With the daily momentum indicators leaning higher, I still prefer to trade from the long side, looking to buy dips towards the 0.9700 with a SL placed under 0.9670. A move above 0.9807 would add to the bullish theory. Note that the 4 hour charts may be building a reverse head-shoulder formation with a neckline currently at around 0.9770, in which case the target would be at around 0.9950.
24 Hour: Neutral | Medium Term: Mildly Bullish | ||
Resistance | Support | ||
0.9825 | 18 May high | 0.9723 | Session low |
0.9807 | 30 May high | 0.9695 | 19 June low |
0.9770 | 15 June high | 0.9670 | Minor |
0.9765 | 20 June high | 0.9640 | 14 June low |
0.9753 | Session high | 0.9613/16 | 6 June low /9 June low |
AUDUSD: 0.7553 |
The Aud remains heavy, weighed down by some risk-off sentiment due to the lower stock markets, and not helped by another selloff in the oil price. The 4 hour momentum indicators are pointing quite sharply lower and further losses may lie ahead.
There is good support in the 0.7525/35 area, which may hold if we see it, but below which could spark increased liquidation of long positions, possibly pointing towards 0.7500. A break of this would lead to 0.7470 although this remains some way off.
With the daily momentum indicators also looking a little heavy, topside momentum currently looks unlikely to get back above the session high of 0.7585 although if wrong we could then see a run back to 0.7600. Further out, resistance would be seen at the trend highs at around 0.7630/35; beyond which would find offers at 0.7645/50 and further gains could potentially test the descending trend resistance levels seen at 0.7695 and eventually at 0.7725.
The idea seems to be to sell rallies, with a tight SL now placed above 0.7600.
24 Hour: Prefer to sell rallies | Medium Term: Neutral – Mildly Bearish ? | ||
Resistance | Support | ||
0.7645 | (61.8% of 0.7750/0.7329) | 0.7560 | 100 DMA |
0.7635/31 | 14 June high/15 June high | 0.7542 | Session low |
0.7623 | 20 June high | 0.7533 | (38.2% of 0.7370/0.7635) /Daily cloud top |
0.7600 | Pivot | 0.7525/21/23 | 200 DMA /12 June low /13 June low |
0.7585 | Session high | 0.7502 | (50% of 0.7370/0.7635) |
NZDUSD: 0.7250 |
The RBNZ have just left rates on hold, as expected, but the algos have created some fairly violent volatility with the Kiwi chopping around sharply between 0.7193/0.7275 in the immediate seconds following the release of the accompanying statement. This was relatively neutral in its outlook although it did say that a lower NZ dollar would help rebalance the growth outlook and that monetary policy will remain accommodative for a considerable period. Why the Kiwi rallied 70 points? – no idea!
The 4 hour/daily momentum indicators are mixed on Thursday and a cautious stance is warranted.
On the topside, the initial resistance will be seen at 0.7275, where a minor descending trend line now lies ahead of the 0.7298 Monday high. If we head back above 0.7300/20 there is little to stop the Kiwi heading on towards 0.7370, beyond which the points to watch would be at 0.7400 and 0.7485.
On the downside, back below 0.7200 would revisit the 15 June low of 0.7185, a break of which would open the way to 0.7165/70 and then to 0.7125 (6 June low) and 0.7110/15. Below 0.7090 would allow a return to minor 0.7050/60 and, further out, support levels would be seen at the 30 May low of 0.7035 and at 0.7000 a break of which could take us back to the 24 May low of 0.6988.
24 Hour: Neutral | Medium Term: Neutral | ||
Resistance | Support | ||
0.7319 | 14 June high | 0.7205 | Session low |
0.7298 | 19 June high | 0.7200 | 16 June low |
0.7285 | Minor | 0.7185 | 15 June low |
0.7266 | 20 June high | 0.7150 | Minor |
0.7249 | Session high | 0.7127 | (38.2% of 0.6817/0.7319) |