30 Sept: Trend table outlook for FX, Commodities, Indices: FXCharts

The trend table looks a little confused on Monday, after a quiet Friday session, and it may remain that way today in view of the relatively quiet calendar, although it will be busy through the rest of the week which will culminate o Friday with the US employment data.

In the FX markets, Sterling and the Kiwi both seems set to remain heavy, while the Australian Dollar will take its guidance from the RBA Meeting, due tomorrow.

US Stocks look heavy in the short term although the indices generally seem to be underpinned so I think any downside may be limited. The ASX SPI200 may have some downside potential if 6640 gives way at any stage although at this point that seems unlikely.  If so the downside potential seems to be somewhere around 6500.

Elsewhere, I still like Gold to break lower, through strong support at 1480/85, and looking to head towards 1400/10. Head/Shoulder fomation building nicely! Patience required!

*Trade of the day: September 30, 20198:25 AM(AET)                 

*This is a personal opinion only, based on the look of the table below, and carries no guarantee of success.

All trades are good till 5.00pm NY time. All “in the money trades” should have the SL raised to break-even, or managed manually. All “out of the money trades” should keep original SL in place.

Sell EurUsd @ 1.0980. SL @ 1.1015, TP @ 1.0875

Buy EurUsd @ 1.0880. SL @ 1.0845, TP @ 1.0950

Sell AudUsd @ 0.6780. SL @ 0.6815, TP @ 0.6700

Buy AudUsd @ 0.6715. SL @ 0.6690, TP @ 0.6775

Sell NzdUsd @ 0.6330. SL @ 0.6355, TP @ 0.6260

Sell Gold @ 1510. SL @ 1522, TP @ 1480

Sell ASX 6635 SL entry. SL @ 6685, TP 6520

EurUsd:  The Euro traded a choppy range of 1.0903/57 on Friday, making a new 2 year low in the process before finding some support because of demand in EurGbp which allowed it to recover somewhat against the dollar, which itself was not helped by some soft data and more US/Chine tensions. Technically 1.0900 is now the important levels to watch, and with plenty of option related defence of this level likely in coming days it would not surprise if it holds for a while. However the direction does seem headed lower for the Euro and below 1.0900 opens the way to 1.0860(76.4% of 1.0340/1.2555) and then there is a weekly chart gap that would take us to 1.0772. On the topside, Friday’s/Thursday’s highs were at 1.0957/66 which will provide the initial resistance ahead of 1.1000 and 1.1024 (23.6% of 1.1411/1.0903). Although unlikely today, a steeper topside squeeze would then allow for a run towards 1.1040/50 and then possibly to the September 18/19 highs at 1.1072/75. I suspect a choppy range above 1.0900 is in store today. The 4 hour charts look underpinned while the dailies point lower but do suggest some bullish divergence so I would not be getting too carried away in either direction although the German Preliminary CPI for September is due today and is unlikely to help the Euro a great deal.

 

US$Jpy:  squeezed up for the 3rd session in a row although it ended Friday just 10 points higher after failing to hold on to US gains above 108.00 (108.17 high). The momentum indicators look a little mixed today and another choppy session may be in store, possibly confined by Friday’s 107.65/108.17 range, and using the100 DMA, at 107.80 as a pivot. Above 108.20 would allow for a run back to 108.45/50, which successfully capped the previous rally, but above which would open the way towards 109.00 and to the 1st August high at 109.31 although this seems some way off. On the downside, support will be seen at both the 100 DMA/Friday low, below which could revisit 107.40 (Thursday low) and to 106.95 (Wednesday low). I am neutral on US$Jpy and would suggest something like 107.60-108.20 for today.

 

AudUsd:  The Aud$ is languishing towards its recent lows ahead of tomorrow’s RBA Meeting and looks unlikely to squeeze much higher today as the prospect for a rate cut gathers pace. If wrong, look for offers to arrive at 0.6780/85 (200 HMA) ahead of a possible move towards 0.6805/10 (27/26 Sept highs), ahead of 0.6830 (minor). If the RBA decide to stay on hold, we are going to see a spike to the topside given the current, overweight short positioning and this would allow a run towards 0.6850 and possibly to 0.6880 and even to the 12 Sept high of 0.6891 although this seems unlikely. On the downside, a move towards 0.6750 (minor) and then to 0.6739/35 (25 Sept low/76.4% of 0.6688/0.6894) seems possible, and I still suspect that we may see a return to 0.6700/10 as an RBA rate cut looms. Below this would open the way back to 0.6688, where we have a minor double bottom (3 Sept/26 August lows) and which comes ahead of 0.6675 (7 Aug low). Below 0.6675, there is minor support at 0.6660, but under there would open the way to 0.6500 and, further out, the next major Fibo level is not seen until 0.6250 (76.4% of 0.4773 (April 2001)/1.1082 (July 2011)). Selling rallies towards 0.6800, with a SL at 0.6835 seems to be the plan for Monday.

                                   

NzdUsd: The Kiwi had a rangebound session on Friday, either side of 0.6300 (23.6% of 0.6450/0.6255), where the 100 HMA/200 HMA are about to cross, but ending just below it and leaving the outlook pretty much unchanged. Friday’s high was 0.6308, above which could then see a squeeze towards 0.6330 (38.2%) and then possibly 0.6350 (0.6348 = 26 Sept high: 0.6352 = 50% Fibo), above which we could see a squeeze back to 0.6375 (61.8%) and then to 0.6400/10. Above here, unlikely in the near term, would allow a move towards 0.6420/25 and on to the trend high of 0.6450 (12 Sept). On the downside, support will be seen at 0.6275/80 and again at 0.6260/65 ahead of the 0.6255, 5 year low. A break of this – unlikely today I suspect – would then open the way to the next meaningful support, seen at the September 2015 low at 0.6235, which should be strong if/when we get there. Below here though, more distant bids would arrive at the August 2015 low at 0.6125. There is some secondary NZ data today which may create some waves. Otherwise, waiting for the RBA, tomorrow, to provide some directional bias, and going with the flow seems the wisest move right now, although overall I still prefer to look for levels to be short.

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