EUR
Comment: Inching to another new record high at 1.4739, the Euro is somewhat overbought and bullish momentum us very strong. Quite terrifying to see how many are only just waking up to the implications of generalised UDS dollar weakness. The Euro remains well bid at these record highs and would benefit from a bout of consolidation. If not today then shortly watch for signs of reaching an interim high and a bout of consolidation.
Strategy: Possibly attempt tiny longs at 1.4705; stop below 1.4600. Target 1.4800, maybe 1.4950.
EUR/JPY
Comment: Still very inconclusive as we hover between the 26-day moving average at 164.10 and trendline resistance. We continue to watch for signs of topping, something which is clear in EUR/CHF.
Strategy: Sell at 165.65; stop above 167.00. Cover ahead of 164.00 but be ready to re-sell on a sustained break below 163.70 for 161.70.
GBP
Comment: Doing better than we had thought posting another multi-year high at 2.1145. This has been our long-held long term target and it comes as a surprise that so many are only just jumping on the bandwagon. Thin markets, historically high levels, and a pound that is worth over two dollars means one has to allow for very big intra-day moves. It is overbought and momentum is strongly bullish so perhaps it has enough steam to get to really silly levels before a bout of consolidation sets in.
Strategy: Possibly attempt tiny longs at 2.1125; stop below 2.0950. Short term target 2.1200.
JPY
Comment: Holding slightly unsteadily above August’s low of 111.60 and yesterday’s ‘doji’ candle suggests we shall do so again today. However, a weekly close below 112.60 should add considerable bearish pressure setting off a sharp move lower later this month. Target 109.00.
Strategy: Sell on a bounce to 113.00/113.40; stop well above 114.10. Short term target 112.00.
