EUR
Comment: Holding at the very top of Friday’s range, terribly close to this year’s high (1.3801 on the 8th January and 1.3739 on the 19th March). It is just a matter of time before we rally here, with the Swiss franc snapping close on the Euro’s heels.
Strategy: Buy at 1.3615, adding to 1.3560; stop well below 1.3400. Add to longs on a sustained break above 1.3670 for March’s high at 1.3739 and then 1.4000.
EUR/JPY
Comment: A ‘bearish engulfing’ candle yesterday adds weight to our view so that we still favour topping activity at current levels as happened in March and April. Perhaps we will hover above the top of the Ichimoku ‘cloud’ today but later this week we feel it will start dropping into it.
Strategy: Attempt shorts at 132.45, adding to 133.00; stop above 134.80. Add to shorts on a sustained break below 131.70 for 130.75 short term and then 128.35.
GBP
Comment: Consolidating just under some of the highest prices so far this year (high 1.5375 8th January). We expect this to be tested some time this week but note that the Yen and Euro should lead the way to generalised US dollar weakness.
Strategy: Buy at 1.5125, adding to 1.5000; stop below 1.4900. Add to longs on a sustained break above 1.5300 for 1.5375 short term and then 1.5725/1.5800.
JPY
Comment: Dipping into a large Ichimoku ‘cloud’, below the moving averages, and looking set to move down towards trendline support at 96.35 today. Over the coming fortnight, maybe for a month, we now expect the Yen to outperform other currencies so that dollar/yen and yen crosses move lower.
Strategy: Attempt shorts at 97.25 but only if prepared to add to 98.00; stop above 99.85. Short term target 97.15, then 96.65 and probably 95.65.
