Technical Analysis for Major Currencies
EURO
The Euro versus Dollar pair continues to correct to the downside towards 1.3850 to build a solid base before rebounding back to the upside to reach the short term upside targets at 1.4180. It is important for the 1.3770 level to remain intact for the incline to continue on the intraday.
The trading range for today is among the key support at 1.3580 and the key resistance at 1.4380
The general trend is to the downside as far as 14710 remains intact with targets at 1.2120
Support: 1.3970, 1.3850, 1.3770, 1.3740, 1.3705
Resistance: 1.4050, 1.4115, 1.4180, 1.4215, 1.4300
Recommendation: According to our analysis, sell the apri below 1.3970 with targets at 1.3850 and stop loss with four hour closing above 1.4050
GBP
Trading remains narrow ranges for the Cable since yesterday yet the pair was able to breach the key support for the minor ascending channel as seen in the above image. We will wait for the next four hour closing to confirm the break which may take the pair to as low as 1.5790 to gather bullish momentum before rebounding back to the upside targeting 1.6100. This incline remains on the short term as far as 1.5650 is intact.
The trading range for today is among the key support at 1.5650 and the key resistance at 1.6200
The general trend is to the upside as far as 1.4840 is intact with targets at 1.6600
Support: 1.5845, 1.5790, 1.5745, 1.5700, 1.5645
Resistance: 1.5890, 1.5950, 1.5995, 1.6030, 1.6100
Recommendation: According to our analysis, buy the pair above 1.5790 with targets at 1.5890 and 1.5995 and stop loss with four hour closing below 1.5700
JPY
After breaching the key resistance for the descending channel, the USD/JPY pair failed to breach the resistance level at 95.20 resulting in a reversal to the downside once again to retest the previously broken resistance level. The pair seems to be forming a bullish technical pattern with a neckline at 95.02 where a breach of this level will take the pair to 96.00 before reversing back to the downside as we pointed out yesterday (click here for yesterday's report). This scenario remains valid unless a decline occurs below 94.25 which may result in further declines. The short term trend remains to the downside with targets at 93.50 and 92.40 as far as 97.10 remains intact.
The trading range for today is among the key support at 91.90 and the key resistance at 97.10
The general trend is to the downside as far as 102.60 remains intact with targets at 84.95 and 82.60
Support: 94.25, 93.95, 93.50, 92.95, 92.40
Resistance: 95.20, 96.00, 96.45, 97.10, 97.60
Recommendation: According to our analysis, sell the pair below 94.25 witht argets at 93.50 and 92.40 and stop loss with four hour closing above 95.20
CHF
The Dollar versus Swissy continued to trade within narrow ranges yesterday yet with tendency towards the key support for the descending channel at 1.0800. We still believe that the pair is to correct to the upside to reach 1.0960 in an attempt to gather bearish momentum to target 1.0745 and 10.570 on the short term as far as 1.070 is intact.
The trading range for today is among the key support at 1.0745 and the key resistance at 1.1205
The general trend is to the upside as far as 1.0570 remains intact with targets at 1.2245
Support: 1.0800, 1.0770, 1.0745, 1.0710, 1.0655
Resistance: 1.0900, 1.0960, 1.1040, 1.1070, 1.1125
Recommendation: According to our analysis, sell the pair below 1.0960 with targets at 1.0800 and stop loss with four hour closing aboev 1.1040
CAD
The Dollar versus Loonie pair was able to incline to reach the resistance level at 1.1290 where we expect to witness slight downside movements from this level to target 1.1185 on the intraday basis before heading towards 1.0930. The downside movements remain as far as 1.1335 is intact.
The trading range for today is among the key support at 1.0935 and the key resistance at 1.1620
The general trend is to the downside as far as 1.1885 remains intact with targets at 1.0300
Support: 1.1210, 1.1185, 1.1120, 1.1085, 1.1040
Resistance: 1.1290, 1.1335, 1.1370, 1.1415, 1.1475
Recommendation: According to our analysis, sell the pair below 1.1290 with targets at 1.1185 and stop loss with four hour closing above 1.1370
Technical Analysis for Crosses
GBP/JPY
The pivot point for intraday trading for today is at 149.90 as this level will determine whether the pair is to incline or decline. The uptrend currently seen in the above image may be stalled as momentum indicators show the pair being overbought yet the possible the formation of a classical bullish technical pattern with a neckline at 149.90 makes us believe that the pair is to incline today as it successfully maintains levels above the neckline. However, reversing to the downside to trade below 149.10 will adjust the intraday trend to the downside.
The trading range for today is among the key support at 145.95 and the key resistance at 155.30
The general trend is to the downside as far as 156.20 remains intact with targets at 116.00
Support: 149.90, 149.10, 148.30, 147.65, 146.90
Resistance: 150.50, 151.00, 152.75, 153.65, 155.30
Recommendation: According to our analysis, buy the pair at 149.90 with targets at 152.75 and stop loss at 148.80
EUR/JPY
The Euro versus Japanese yen continues to consolidate within a triangle that could be a corrective wave in the Elliott cycle before continuing the incline. Momentum indicators show the pair being overbought yet as long as trading remains above the 100 MA at 131.40, the upside trend on the intraday basis will continue targeting the key resistance for the technical pattern at 133.55. Breaching this level to the upside will result in a vigorous movement.
The trading range for today is among the key support at 130.05 and the key resistance at 135.60
The general trend is to the downside as far as 141.44 remains intact with targets at 100.00 and 88.97
Support: 132.30, 132.15, 131.75, 131.40, 130.50
Resistance: 133.00, 133.55, 134.45, 134.80, 135.60
Recommendation: According to our analysis, buy the pair at 132.30 with targets at 133.55 and stop loss at 131.00
EUR/GBP
The short term downside trend continues as far as trading remains below 0.8905 which resides above the 100 MA at 0.8875. However, as the EUR/GBP pair continues to fluctuate sideways, we expect the pair is to retest the 0.8730 – 0.8720 level where a breach of this level to the downside will accelerate the downside movements yet maintaining levels above it will rebound trading towards 0.8875. Note that the short term trend remains to the downside.
The trading range for today is among the key support at 0.8580 and the key resistance at 0.8930
The general trend is to the upside as far as 0.8020 is intact with targets at 1.0000 and 1.0400
Support: 0.8760, 0.8720, 0.8700, 0.8675, 0.8645
Resistance: 0.8815, 0.8845, 0.8870, 0.8900, 0.8930
Recommendation: According to our analysis, sell the pair at 0.8790 with targets at 0.8720 and stop loss at 0.8835
Here is the video:
05-26-2009.swf
We're seeing the risk aversion sentiment continue to weigh on markets, but we still haven't quite gotten that breakout lower yet to both fully confirm our outlook and accellerate things lower. The 875 level on the S&P 500 futures is the key level to watch while the 132 handle is the near term support to watch on the EUR/JPY. Please watch the video for a much more detailed look at EUR/USD, US equities and gold. Monday's German IFO came in lower than expected, but not low enough to hit our sell trigger, so the price action wasn't terribly strong. There are several news items due out Tuesday, but none are very tradable on currencies right now in my opinion. In the video I explain a bit about most of them and what they might bring to the table though. The next clearly tradable report is out Wednesday morning:
1000 Wednesday 5-27 US Existing Home Sales m/m (4.66M expected) - This indicator has performed quite well on the EUR/JPY when it hits a nice trigger.
If it comes out at 4.80M or higher, EUR/JPY should rally 50 pips or more
If it comes out at 4.52M or lower, EUR/JPY should sell off 50 pips or more
For more on forex signal click here.
