EUR
Comment: Dipping as feared to its lowest in two months though still holding inside a downward-sloping ‘wedge’ formation. Watch for more cautious attempts at forming an interim base this week, possibly with a rather scary ‘spike low’.
Strategy: Do nothing if possible. For those who have to attempt tiny longs at 1.2635; stop well below 1.2600. First target 1.2800, then 1.2945.
EUR/JPY
Comment: Little to add as we creep slowly sideways across the page. Expect more of the same today and maybe all week.
Strategy: Attempt small longs at 116.75; stop below 114.00. First target 118.00, then 120.00.
GBP
Comment: Ducking below the headlines as Eastern Europe and the Euro take the brunt of the selling. Cable should try again this week to form an interim low, hopefully around retracement support but maybe we shall have to live through a nasty ‘spike low’.
Strategy: Possibly attempt tiny longs at 1.4180; stop well below 1.4050. Short term target 1.4400, then 1.4600.
JPY
Comment: Inching through trendline resistance and we favour a short squeeze to the top of the large Ichimoku ‘cloud’, something that may surprise many as consensus opinion is still for Yen strength this year against all currencies as unwinding of the ‘carry trade’ continues. We disagree with this consensus view.
Strategy: Attempt small longs on a dip to 92.00, adding to 91.00; stop/reverse below 89.70 for 88.50. Add to longs above 92.75 for 93.85/94.00.
