EUR

Comment: Rallying strongly from the top of a very thin Ichimoku ‘cloud’ and breaking though September’s high at 1.2830. There are plenty of chart levels on the way up, but hopefully generalised US dollar weakness will sent currencies one by one though these hurdles. Bullish momentum is at its strongest since early August (when the Euro touched 1.2913) and the Euro is only slightly overbought. For today if we can hold above 1.2827 upside pressure should increase.

Strategy: Buy at 1.2855/1.2830; stop below 1.2745. Short term target 1.2880, then 1.2980.

EUR/JPY

Comment: Breaking and closing at a new all-time high and clearly above the top of a right-angled ‘triangle’. Some other Yen crosses look similar, so we feel this signals the start of another round of Yen weakness. Watch for strong weekly closes tonight, which should add serious upside pressure and force many into taking action. For this morning and maybe all day allow for consolidation between 150.50 and 151.50; then up again next week where our medium term target lies at 155.00.

Strategy: Buy at 151.00, adding to 150.50; stop below 150.20. Targets as above.

GBP

Comment: Consolidating just below important long term resistance at 1.9100/1.9145. The 9-day average might just limit the downside again today and note that despite yesterday’s large ‘spike low’ Cable managed to close above the average. Note that Cable is not overbought and a weekly close above 1.9150 sets up for a sharp squeeze to very long term resistance around 1.9500.

Strategy: Buy at 1.9085/1.9045; stop below 1.8975. Short term target 1.9120/1.9145, then 1.9215 and 1.9325.

JPY

Comment: A large ‘spike high/shooting star’ candle yesterday has sent this pair back down to the top of the Ichimoku ‘cloud’. Momentum is just bearish and should increase if we hold below 118.00 today; the US dollar is not oversold. For today allow for more consolidation above 117.00, noting that a close below 117.00 should increase downside momentum by enough to test weekly trendline support at 116.57 next week.

Strategy: Sell at 117.80/118.00; stop above 118.60. Short term target 117.20, then the more important 116.55 area.