Forex Technicals:
- EUR/USD - given a boost by the wider than expected U.S. trade deficit yesterday, the currency pair has been to 1.2100 and should rise further to at least 1.2140/50 area. No change in the view -- the market needs to push the currency above 1.2160 to swing the short-term weakness around. To sum up -- watch for the price action if/when the currency comes to those important levels -- a rally above 1.2160 suggests that the currency weakness is over. No change in the medium-term outlook, which still argues for a bigger euro recovery down the road. We will be fine-tuning the possibility that we have seen a significant bottom, and once the low is firmly established by a break of 1.2160, then we will refocus at 1.2500 area again.
- GBP/USD - the currency has been higher since the 1.8048 trough, with a little help from the U..S. trade data yesterday. The uptrend should survived any further weakness, probably to 1.8100. And once the low is confirmed later in the week, then we will refocus at at 1.8600 - 1.8700 targets.
- USD/JPY - the currency did reach 111.50 before the rally faded away. It has been lower since then. There is no change in the longer-term view however -- the downtrend reasserts thereafter and should go lower further to 108.00 and then to 106.85.
- USD/CHF - the currency did find resistance at circa 1.2665, found support at 1.2507 and may bounce back to just below 1.2600 later in the day. Nonetheless, the main downtrend remains intact and should continue lower thereafter, which should bring on 1.2285 - 1.2270, then 1.2140, the downside xobjective in this cycle, the primary target of the entire decline from 1.3225 top.
- USD/CAD -- the recovery did extend --and how. The currency rose further to 1.3787. But it may be bumping into some resistance at these levels. Expect the currency to fall back to the 1.3600 area later in the week. The downtrend should resume thereafter; the next downside target thereafter may still be the area of 1.3350.
- AUD/USD - we might see the currency make further moves to .6800 -- although this is not a given. Once support is confirmed, then we start refocusing at .7000 xobjectives again, and further out .7200 beckons.
- NZD/USD - the downward correction had another stab at .6220, and should rise again from here (,6245). The main theme is unchanged -- the uptrend should reassert thereafter, and may proceed to .6300 area at least, then .6400 further out, after which may see the currency may pause some more. Much further out, we still focus at .6700.
- EUR/JPY - the cross has been to 135.50, pulled back some, and should find support at 133.60/55. The rally should resume from there, with 1.3700 as the next xobjective. Further upmove to 139.00 hopefully follows.
- EUR/CHF - the cross has been to 1.5180, and is pulling back. It may yet rise further to 1.5200, and hope the momentum will carry the cross over the hump. Until then, the cross may be still susceptible to a final downmove to 1.5000.
- EUR/GBP - The cross should continue to recover from here, and go for just under .6700. Further out, the cross should make a new bid for .6812 chart xobjective thereafter.
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