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

With all the momentum indicators aligned to point higher on Friday the downside does look a little limited but back below 1.1600 could see a run back towards 1.1560/80 and then possibly to 1.1530 although this looks doubtful right now.

Further out, the session low was at 1.1478 and if/when we break under this we could then see a return to Monday’s low of 1.1435, to 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.

The momentum indicators are now looking mixed and another choppy session either side of 112.00 would not surprise. 111.70 will again see buyers, below which could then head back towards 111.50. Under there, the monthly cloud top is still at 111.30 and should also see strong bids. Below here though could then see a run to 111.00 and to 110.65.

On the topside, the daily charts are pointing still pointing lower, but if we do see a near-term bounce then 112.40 will provide the initial resistance ahead of 112.65/70 will provide the initial resistance. If we get back above the 17 July high of 112.85 further offers will arrive at 113.00 ahead of 14 July’s high at 113.57.

The momentum indicators are a mixed again on Friday and a cautious stance is required, and while the short term indicators do point lower, the dailies remain flat, and while the US$ remains under pressure elsewhere Cable should remain relatively underpinned..

On the downside, below the 1.2933 low would find support at the Fibo level at 1.2920, below which could then see a move towards 1.2850 (38.2% of 1.2589/1.3125) although this remains some way off.

On the topside, back above the session high of 1.3032 would find offer at 1.3050/60. Beyond that, 1.3100 would see good sellers once again ahead of 1.3115/25, 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.

The momentum indicators look heavy and if we move below the 0.9492 low, then there is little to stop the dollar heading towards 0.9440 and then to 0.9400, with little real support seen until 0.9330 (50% pivot of 0.8326/1.0343). A close below the 200 WMA today would reinforce this view.

On the topside, 0.9550 will provide the immediate resistance ahead of a possible return to 0.9600 and the session high of 0.9620.

Beyond there, unlikely today, could return to the 18 July high of 0.9634 beyond which could see a return to 0.9675/85 and possibly to last Friday’s high of 0.9700.

The momentum indicators are now mixed and a session of consolidation, within Thursday’s range would not really surprise although the RBAs Debelle will be speaking today and may attempt to talk the Aud lower.

A move back to the 0.7988 high could then see a run towards 0.8000 and then to 0.8015 although I don’t think we are going there today.

Minor support now arrives at 0.7935 and at 0.7920 would find stronger bids at 0.7900 and then again at 0.7875 and at 0.7840 although it seems unlikely to be seen down here today.

The short term momentum indicators all now look mildly more constructive and we could yet see move beyond the day’s high and on towards 0.7450. Beyond there would then allow a run back to the September high of 0.7485 although it is too early to look at this, but beyond which, the 100 MMA is at 0.7540.

On the downside the initial, minor, support lies at 0.7385 and at 0.7365 ahead of the session low of 0.7333. Below here, unlikely today, would then allow a run to 0.7315 and 0.7300. Below there could then re-open the way to 0.7260 and eventually to the 13 July low of 0.7245.