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

EURUSD: 1.1346
  • Short term momentum indicators: Down
  • Daily momentum indicators: Possible topping formation.
  • Upcoming market moving events: The FOMC Minutes will be the focus but the global Services/Composite PMIs are also due.
24 Hour Outlook: Neutral Medium Term: Prefer to buy dips
Preferred 24-hour Strategy:  The Euro remains heavy but rangebound at the end of the US holiday and it is likely to remain that way until the FOMC Minutes are released later in the day unless the PMIs are way-off expectations.  Back below 1.1335 could see a slide to 1.1300/10, possibly to 1.1280, but buying dips still seems to be the plan given the positive look of the longer term momentum indicators. Below 1.1280 could then see a slide towards 1.1235On the topside, the session high has been 1.1375. A break of this would allow a move back to 1.1400 although I don’t really see this happening unless the Fed is more dovish than the markets generally expect.

A break of 1.1400 would then target 1.1445/50 a break of which would then open the way to the May 2016 high of 1.1616 although this seems rather unlikely for a while to come.  Look for 1.13/1.14 to contain it again for most of the session and wait for the FOMC Minutes to provide the direction.

Resistance Support
1.1480 Minor 1.1335 Session low
1.1445 Descending trend resistance/29 June high/29 June high 1.1320 (38.2% of 1.1117/1.1445)
1.1426 3 July high 1.1310 200 HMA
1.1395 100 HMA 1.1285 (50% of 1.1117/1.1445)
1.1376 Session high 1.1242 (61.8% of 1.1117/1.1445)

Economic data highlights will include:

ECB Non – Monetary Policy Meeting, EU Services/Composite PMIs, Retail Sales, US Factory Orders, ISM NY Index, FOMC Minutes, Monetary Policy Report


USDJPY: 113.27
  • Short term momentum indicators: Neutral
  • Daily momentum indicators: Turning higher
  • Upcoming market moving events: Markit Services PMI
24 Hour Outlook: Prefer to buy dips Medium Term: Mildly Bullish
Preferred 24-hour Strategy: US$Jpy consolidated near 113.00 on Tuesday, with a quick spike to 112.73 after the Neutral Korea missile statement. Look for a fairly quit one today and use 112.80/113.50 as a range.
Resistance Support
114.35 10 May high 113.00 Pivot
114.00 Minor 112.73 Session low
113.85 15 May high 112.60 Minor
113.70 Minor 112.35 (23.6% of 108.80/113.45)
113.45 Session high 112.05 Minor

Economic data highlights will include:

Markit Services PMI


GBPUSD: 1.2920
  • Short term momentum indicators: Turning lower
  • Daily momentum indicators: Neutral –Turning higher?
  • Upcoming market moving events: Markit Services PMI
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: Cable has been unable to reach 1.3000 on Tuesday and traded a tight 40 point range above 1.2900. The momentum indicators are mixed but possible short term weakness looks possible, which would again find support at 1.2910 (Daily cloud top) but below which could run to 1.2860. On the topside, resistance will be seen at 1.2880, 1.3000 and again at 1.3022, the 3 July high, although this seems unlikely to be seen on Wednesday unless the FOMC Minutes are overly dovish..
Resistance Support
1.3047 18 May high 1.2910/12 Daily cloud top/Session low
1.3022 3 July high 1.2860 (38.2% of 1.2588/1.3029)
1.3000 Pivot 1.2835 Minor
1.2975 Minor 1.2810 (50% of 1.2588/1.3029)
1.2958 Session high 1.2785 Minor

Economic data highlights will include:

Markit Services PMI


USDCHF: 0.9654
  • Short term momentum indicators: Neutral –Turning higher?
  • Daily momentum indicators: Turning higher?
  • Upcoming market moving events: Nil.
24 Hour Outlook: Neutral Medium Term: Neutral
Preferred 24-hour Strategy: US$Chf is a little higher, at 0.9650, with the short term momentum indicators hinting at a run towards 0.9680, possibly 0.9700. On the downside, support will be seen at 0.9600 and again at 0.9550/55. A range trade 3 July of 0.9600/0.9680 seems most likely today.
Resistance Support
0.9750 Descending trend resistance 0.9621 Session low
0.9730 Minor 0.9600 Minor
0.9700 Minor 0.9585 Minor
0.9680 (23.6% of 1.0099/0.9555) 0.9555/52 3 July low/29 June low
0.0.9658 Session high 0.9548 9 Nov low


AUDUSD: 0.7603
  • Short term momentum indicators: Mixed.
  • Daily momentum indicators: Turning lower?
  • Upcoming market moving events: AIG Performance of Services Index , Caixin China Services PMI
24 Hour Outlook: Prefer to sell rallies Medium Term: Neutral –Turning slightly bearish
Preferred 24-hour Strategy: Despite the upbeat Retail Sales yesterday, the Aud took its direction from the neutral tone of the RBA Statement and headed lower, reaching 0.7590, before a dead-cat bounce to 0.7600. While the short term momentum indicators are now mixed, the daily charts hint at further weakness ahead so selling rallies is preferred. Leave a SL above the session high of 0.7682.
Resistance Support
0.7700 Pivot 0.7590 Session low
0.7685 Minor 0.7580/82 (38.2% of 0.7373/0.7710)
0.7660 100 HMA 0.7565 (38.2% of 0.7328/0.7710)
0.7635 Minor 0.7540 (50% pivot of 0.7373/0.7710)
0.7620 200 HMA 0.7520 (50% pivot of 0.7328/0.7710)

Economic data highlights will include:

AIG Services PMI, Caixin China Services PMI


NZDUSD: 0.7287
  • Short term momentum indicators: Neutral
  • Daily momentum indicators: Turning lower?
  • Upcoming market moving events: ANZ Commodity Index
24 Hour Outlook: Prefer to sell rallies Medium Term: Neutral
Preferred 24-hour Strategy: The Kiwi still seems to be building a topping formation although the price action is very choppy and difficult to get a handle on. As before, I prefer to sell rallies, with a SL placed above 0.7350. There has been a lot of selling of AudNzd today, with the cross falling 150 pb, and a test of the major support at around 1.0360/70 may be on the cards. There will be plenty of stops if we go below that level.
                                         Resistance             Support
0.7402 8 Nov high 0.7275 Minor
0.7360 Minor 0.7261 Session low
0.7344/45 3 July high/29 June high 0.7253 28 June low
0.7325 Minor 0.7220 (23.6% of 0.6816/0.7343)
0.7298 Session high 0.7193 22 June low

Economic data highlights will include:

ANZ Commodity Index

By | July 5, 2017
Source: FXCharts

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