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Technical Analysis (2015-08-31)

EUR/USD
Previous Day Range High: 1.1310 Low: 1.1156 Close: 1.1187
Technical Chart Resistance
R-2:1.1372
R-1:1.1279





Support
S-1:1.1125
S-2:1.1063



Forecast
High:1.1279
Low:1.1125






EUR/USD surged to as high as 1.1713 last week but faced strong resistance below 1.1810 fibonacci level and reversed. Initial bias is mildly on the downside this week for 1.1016 support first. Break will larger 1.0807. Decisive break there will confirm completion of whole rise from 1.0461 and would likely extend the larger down trend. On the upside, above 1.1363 minor resistance will turn bias neutral.
USD/JPY
Previous Day Range High: 124.55 Low: 120.56 Close: 121.40
Technical Chart Resistance
R-2:122.10
R-1:121.75
Support
S-1:120.85
S-2:120.30



Forecast
High:121.75
Low:120.85





USD/JPY dropped sharply to 116.13 last week. The pair then drew support from 115.55/116.38 (38.2% retracement of 101.08 to 125.85 at 116.38) and rebounded. Price actions from 125.85 should develop into a corrective pattern that would extend in short to medium term. Thus we'd expect strong resistance above 61.8% retracement of 125.27 to 116.13 at 119.62 and bring another fall. Below 119.78 minor support will turn bias to the downside for 115.55/116.38 support again.
GBP/USD
Previous Day Range High: 1.5443 Low: 1.5336 Close: 1.5397
Technical Chart Resistance
R-2:1.5499
R-1:1.5448





Support
S-1:1.5341
S-2:1.5285



Forecast
High:1.5448
Low:1.5341





GBP/USD rose to 1.5817 last week but dropped sharply since then. The development suggests that the corrective pattern from 1.5329 has completed with three waves up to 1.5817. Initial bias remains on the downside this week for 1.5329 first. Break will resume the fall from 1.5929 and target 100% projection of 1.5929 to 1.5329 from 1.5817 at 1.5217. Break will target 161.8% projection at 1.4846. On the upside, above 1.5508 minor resistance will turn bias neutral first. But risk will now stay on the downside as long as 1.5817 resistance holds.
USD/CHF
Previous Day Range High: 0.9668 Low: 0.9579 Close: 0.9622
Technical Chart Resistance
R-2:0.9712
R-1:0.9667





Support
S-1:0.9578
S-2:0.9535



Forecast
High:0.9667
Low:0.9578





USD/CHF dived to as low as 0.9256 last week but rebounded strongly since then. The development suggests that recent sideway pattern is developing into a triangle. From a near term angle, strong resistance would likely be seen below 0.9902 to limit upside. Meanwhile, strong support would be seen above 0.9256 to contain downside. A breakout is expected at a later stage.
AUD/USD
Previous Day Range High: 0.7206 Low: 0.7121 Close: 0.7167
Technical Chart Resistance
R-2:0.7249
R-1:0.7208





Support
S-1:0.7123
S-2:0.7080



Forecast
High:0.7208
Low:0.7123





Having traded between a wild three cent range when valued against its US Counterpart last week, the Australian dollar open this morning on more steady footing as it currently buys 71.65 US Cents. During a period of heightened volatility investors are looking towards a more fundamentally market driven window as economic flows from within the US still suggest a high probability that interest rates will rise in September for the first time in nine years. Should broader measures of sentiment stabilise over the coming its expected ranges that ranges between 0.7000 – 0.7250 should be well contained. In an otherwise light economic calendar today, the RBA’s rate statement tomorrow promises to provide the Aussie first major hurdle of the week.

We expect a range today of 0.7100 – 0.7220.
USD/CAD
Previous Day Range High: 1.3300 Low: 1.3167 Close: 1.3214
Technical Chart Resistance
R-2:1.3361
R-1:1.3287





Support
S-1:1.3154
S-2:1.3094



Forecast
High:1.3287
Low:1.3154





Yesterday, the Dow Jones closed 2% higher and today the futures market is signalling the Dow to open 150pts lower. All US stock futures are lower this morning again underling a volatile week in stocks and currencies. There are no economic fundamentals out for Canada to end the week. In the U.S. we had Personal Spending out at 8:30am with a reading of 0.3%, which was below forecasts of 0.4%, but better than previous 0.2% causing a volatile reaction on the USDCAD currency pair. At 10am we will have the final reading of the University of Michigan Consumer Sentiment for August. Central Bankers continue their meetings in Jackson Hole Wyoming today and tomorrow, but FOMC member Fischer is anticipated to speak at 11:20 from Jackson Whole. His speech has the potential to signal what future moves the Feds could be considering, watch for volatility.

We expect a range today of 1.3210 to 1.3348.