The following are the latest technical setups for EUR/USD, USD/JPY, GBP/USD, and AUD/USD as provided by the technical strategy team at Credit Suisse.
EUR/USD: EURUSD holds a bearish "wedge" and a “head & shoulders” top for 1.3374 initially, then 1.3248.
EURUSD continues to consolidate recent losses, and with minor resistance levels still as yet still unchallenged and a large bear "wedge" pattern and now also "head & shoulders" top in place, we stay directly bearish. We look for further weakness to 1.3399 initially, then the 50% retracement of the 2013/14 rise at 1.3374. We allow for a bounce here ahead of our target at 1.3248/28 – the 38.2% retracement of the entire 2012/2014 uptrend. While we would expect this to hold at first, bigger picture, we see scope for 1.2755.
Resistance shows at 1.3486/95 initially, above which can see a move back to 1.3531, with 1.3550/53 ideally capping to keep the immediate risk lower.
CS holds EUR/USD short with a stop at 1.3553, targeting 1.3250.
USD/JPY: A clear break above 101.87/88 can see a small base.
USDJPY has rallied higher to see a test of the cluster of resistances at 101.81/88 – the 55-day average, 61.8% retracement of the decline from early July downtrend and price resistance. Above here though is needed to form a small base to aim at the 200-day average at 102.07, ahead of the July high at 102.28, which we would expect to ideally cap for a turn lower.
While capped at 101.88, the risk can stay marginally lower towards 101.32 initially, followed by the early July low at 101.06. Below this can then see a challenge of more important support from the lower end of the medium-term range at 100.85/75.
GBP/USD: GBPUSD’s removal of 1.7001 keeps the correction in force for more important support at 1.6952/42.
GBPUSD has fallen further this week removing 1.7001 – the 38.2% retracement of the May/July rally. This should allow a deeper setback to 1.6952/42 – the 50% retracement level, late June low and rising 55-day average. We would expect this level to attract better buying interest. A break though would see a top, targeting channel support and the 61.8% retracement at 1.6887/84.
Near-term resistance shows at 1.7024, then 1.7055. Above 1.7097/7101 is needed for a small base for a move back to 1.7152, then the 1.7181 early July high.
AUD/USD: Price support at .9380 ideally holds to keep the immediate risk higher.
AUDUSD has staged a reversal lower, but while still holding above .9380, the immediate risk can stay higher for a move back to the .9472 recent high. Above here can then see a challenge of the 2014 high at .9506 where we would expect to find a ceiling. However, a direct extension of strength can see a move towards the 38.2% retracement of the decline from 2011/2014 at .9584, with better sellers expected here.
Immediate support shows at .9380. A break below here is needed to ease the immediate upside bias, for weakness back to .9322/18.
CS holds AUD/USD Long, with a stop at .9320 targeting .9580.
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