Language

Technical Analysis (2014-07-25)

EUR/USD
Previous Day Range High: 1.3485 Low: 1.3438 Close: 1.3464
Technical Chart Resistance
R-2:1.3509
R-1:1.3487






Support
S-1:1.3440
S-2:1.3416




Forecast
High:1.3487
Low:1.3440





Intraday bias in EUR/USD remains on the downside for the moment. Sustained trading below 1.3476 key support will carry larger bearish implication and will target 61.8% projection of 1.3993 to 1.3502 from 1.3700 at 1.3397. Nonetheless, it should be noted again that strong rebound from the current level will dampen the bearish case of trend reversal. And above 1.3548 minor resistance will turn intraday bias neutral first.

In the bigger picture, overall price actions from 1.6039 is viewed as a corrective pattern. The choppy rise from 1.2042 is seen as a leg inside the pattern. Bearish divergence condition in daily and weekly MACD raises the chance that this leg is finished at 1.3993 already. Sustained break of 1.3476 support will confirm this bearish case and should target 1.2755 and below. Meanwhile, break of 1.3993 is needed to confirm rally resumption. Otherwise, we won't turn bullish even in case of strong rebound.
USD/JPY
Previous Day Range High: 101.86 Low: 101.42 Close: 101.76
Technical Chart Resistance
R-2:102.12
R-1:101.94








Support
S-1:101.50
S-2:101.24




Forecast
High:101.94
Low:101.50









The USD/JPY pair initially fell during the session on Wednesday, but found enough support below in order to turn things back around and form a hammer. This market is towards the bottom of the larger consolidation area, so we are interested in buying it. The fact that we formed a hammer of course suggests to us that we will bounce from here and head towards the 102 level, and possibly the 103 level which we see as the very top of the larger consolidation area. With their been so much support below the 101 level, and perhaps extend all the way to the 100 level, we have no interest in shorting at the moment.

GBP/USD
Previous Day Range High: 1.7053 Low: 1.6966 Close: 1.6988
Technical Chart Resistance
R-2:1.7089
R-1:1.7039






Support
S-1:1.6952
S-2:1.6915




Forecast
High:1.7039
Low:1.6952





The GBP/USD pair initially tried to rally during the session on Wednesday, but with the Bank of England failing to impress upon the market a bit of a drive to tighten monetary policy, the British pound was in fact sold off later in the day. That being the case, we formed a shooting star, which sits just above a very significant support area. The 1.70 level of course is the significant bottom that we have been watching, so a supportive candle just below of course is something that we plan on buying.
USD/CHF
Previous Day Range High: 0.9038 Low: 0.9008 Close: 0.9024
Technical Chart Resistance
R-2:0.9053
R-1:0.9038






Support
S-1:0.9009
S-2:0.8994




Forecast
High:0.9038Low:0.9009






Intraday bias in USD/CHF remains on the upside for the moment. Break of 0.9036 resistance will confirm resumption of whole rise from 0.8702 and should target 0.9156 key resistance next. On the downside, below 0.8970 minor support will suggest that the consolidation from 0.9036 is still in progress and will turn bias back to the downside for 0.8897 support.

In the bigger picture, price actions from 0.9971 are still viewed as a correction pattern. Decline from 0.9838 is seen as the third leg. As long as 0.9156 resistance holds, deeper fall would still be seen to 50% retracement of 0.7065 to 0.9971 at 0.8518 and below. We'd start to look for reversal signal below 0.8518 again. Meanwhile, note that medium term downside momentum has been diminishing as seen in weekly MACD. Break of 0.9156 will argue that such correction pattern is completed and will turn outlook bullish for a test on 0.9971.
AUD/USD
Previous Day Range High: 0.9473 Low: 0.9412 Close: 0.9422
Technical Chart Resistance
R-2:0.9497
R-1:0.9460










Support
S-1:0.9399
S-2:0.9375




Forecast
High:0.9460
Low:0.9399





The Australian dollar continued to outperform the other major currencies on Thursday however this time was bolstered by strong Chinese numbers released just before midday. Chinese flash manufacturing data helped the Aussie dollar jump another half a cent to highs of 0.9469 after reaching a juncture not seen in a year and a half with a figure of 52. This beat out forecast of 51 where any number above 50 shows expansion. The strong Chinese print is a welcome sign where there have been concerns as of late in regards to the China growth story, Australia’s biggest trading partner. Overnight the Greenback rallied underpinned by strong jobless claim figures as the AUD opens marginally weaker against the US this morning at 0.9415. Heading into the weekend there is no local data being released as investors will turn offshore for direction.

We expect a range today of 0.9375 – 0.9455
USD/CAD
Previous Day Range High: 1.0752 Low: 1.0715 Close: 1.0741
Technical Chart Resistance
R-2:1.0772
R-1:1.0756






Support
S-1:1.0720
S-2:1.0699




Forecast
High:1.0756
Low:1.0720





The Loonie continues to hover in a very narrow trading range (22 bps) as there appears to be very little appetite to challenge the current range of 1.0710 to 1.0780. With no Canadian data the rest of the week we will continue to be range bound unless the larger FX themes carry through to USDCAD.

We expect a range today of 1.0720 to 1.0760