|
We mentioned yesterday that the 10 week downtrend on USD JPY was still playing out nicely and that 90.00 represented a decent short entry. After touching 90.03 intraday the pair has now fallen to the 89.00 region and the downtrend is obviously still intact and deserves respect. 89.70 now looks like the area to attract new shorts with 88.59 and 88.23 providing support below. Only a break above 90.20 puts this downtrend in jeopardy.
|
|
Yesterday we said that we expected 1.4876 to provide an intraday followed by a brief pause. After hitting 1.48758 the pair settled back for the rest of the day to trade around the 1.4805/15 mark where the bulls waited patiently for the Intel numbers. Having beaten the estimates in every aspect - net income, revenue and margins - the risk appetite is fully intact over night and the EUR bulls have now taken the pair through the major resistance at 1.4876. Next stop from here is 1.4967 and thereafter 1.5346. The only hope for the bears here is that the RSI rolls over on a 4 hour chart and gets back below the downtrend line asap, otherwise one has to step aside and let the bulls take it to wherever they like.
|
|
By popular demand & for those of you who played the long term EUR CAD downtrend highlighted some time back, please be aware that the pair is approaching significant support levels around 1.5200/5262 so there is a possibility of some short covering in the very near term. Even if it should break there, then there is not much further in the chart for the shorts as mass short covering is likely at the lower downtrend line and support at 1.4924. In summary, the whole 1.50 region is likely to attract major long interest, most notably from the BOC who are concerned about the growth impact of too strong a Canadian dollar.
|
|
USD JPY finally made a visit to the upper downtrend line in the last few days after spending a lot of time threatening the lower support at 88.23. Having confirmed the downtrend is still intact with two sell offs from the trendline at 90.40 and 90.20, we would be looking to see new short selling come in if the pair retests the line again at 90.00 with stops above the prior high at 90.50.
|
|
There is the last of the big resistance levels just above on EUR USD as the pair trades at 1.4865 this afternoon. If we break higher above 1.4876 then expect to see more stops getting triggered and a move to 1.4967 which will be the last hope for the bears as there is nothing above there until 1.5350!!! For now however we have some RSI divergence on a daily and 4 hour chart so expect a pause here at the very least.
|
|
|
A very simple picture on USD CHF right now with the very last hopes of an uptrend hanging on to support and the 3 week uptrend at 1.0237 . A break below 1.0237 targets a revisit to the low at 1.0186. The 4 day downtrend channel and resistance at 1.0326 will likely pull shorts into the pair at that level so there is some decent 90 pip range trading to be had here. 
|
|
We spoke a couple of days ago about the symmetrical triangle on USD JPY and over the last 48 hours it has played out with amazing precision, no doubt bring some day traders back into the action of what was startign to become a rather boring picture. The pair has found good support at the lower downtrend channel of the entire 6 month down move around the 88.23 level but a break lower would be targetting the 14 year low of 87.07. Intraday shorts may be expected at 89.17 on the corner of the triangle and mid channel downtrend. 
|
|
The head and shoulders is now completely negated as the pair rallies this morning to the resistance at 1.4786. There is once again significant RSI divergence on the 4 hour chart at this level (as we had on the first visit to this resistance zone) so a brief pause can be expected but we have to face the fact that a break above here targets 1.4845 and thereafter the major resistance at 1.4876. The 10 month uptrend now comes in at around 1.4570 so expect any weakness to be met by fresh demand at those levels. Support before that at 1.4684 and 1.4615. 
|
|
For those of you who have been with us a while you may remember our discussion of a cup and handle breakout on AUD USD back down at 0.8237 in mid July when we put a medium term primary target on the pair of 0.9148. There have been many many day trades to be had around that position in the meantime and after the recent rise in AUD interest rates and Alcoa's suprise earnings last night, the pair is very close to that primary target, trading this morning around 0.9040. The pair has been forming a massive risng wedge throughout its entire upmove, the upper boundary of which "coincidentally", lies at....yeap, 0.9148. This wedge can obviously be broken to the upside and the pair could go on towards the full target of 1.02 but lets not get carried away. Yes, Alcoa's earning's were positive but let's not forget that it was due to a cost cutting exercise and revenue was down 33% on Q3 2008. Shocking really bearing in mind the world was at a virtual standstill at that time. I am not saying jump in front of the freight train right now, but take this information, remember it, and use when the first signs of weakness finally appear in the coming months.
|
|
Cable has made a move this morning up to the 4 week downtrend channel that has been forming the second shoulder in the pair. There is a chance of some bravehearted shorts selling around current levels (1.0630 at time of writing) but with EUR USD and USD CHF having broken their respective short term trends, it is debatable as to whether a short right here is brave or foolhardy. Expect stops at 1.6080 on those positions that are taken. 
|
|
|
|
|
|
|
Page 49 of 54 |
