EUR
Comment: Like so many other currencies, the Euro is stuck in a relatively tight range despite sharp intra-day moves. Yesterday’s small ‘spike low’ below the 9-day moving average just might add some upside momentum. Expect more of the same with chart levels less likely to hold the longer we stick to current levels.
Strategy: Buy at 1.2820; stop well below 1.2765. Short term target 1.2900, then 1.3000.
EUR/JPY
Comment: Almost a ‘bullish engulfing’ candle yesterday underlines just how well bid this currency pair is despite trading at record highs. Allow for more consolidation between 150.50 and 151.50 today. Note the cross is no longer overbought and momentum remains bullish. Implied volatility is very low indeed.
Strategy: Attempt small longs at 151.00/150.80; stop well below 150.50. Short term target 151.45 and 155.00 medium term.
GBP
Comment: Collapsing from important long term resistance at 1.9100/1.9145 and we are back to the middle of the range of the last three months. Hopefully the Ichimoku ‘cloud’ and 26-day average will stem the flow, so expect basing activity against here this morning. Note that Cable is not overbought and that momentum is neutral.
Strategy: Attempt small longs at 1.8885; stop below 1.8830. Short term target 1.9050.
JPY
Comment: Trapped inside a fat Ichimoku ‘cloud’, below the 26-day average, even with comments from a Chinese central bank official that they had been buying Yen. Momentum is neutral and so is the RSI. For this morning allow for a cautious upside test at 118.20/118.50, then down again towards 117.20 very late in the day.
Strategy: Sell at 118.00/118.20; stop above 118.60. Short term target 117.25/117.00.
