EUR
Comment: There is no gap in the data as the Euro retraces 38% of the most recent advance. We expect it to stabilise today and then re-test recent highs next week.
Strategy: Buy at 1.3830/00; stop well below 1.3700. Short term target 1.4000, then a lot more with a first measured target at 1.4200 then 1.4550.
EUR/JPY
Comment: Edging to a new recent high as we consolidate above a very large Ichimoku ‘cloud’ in what we now see as a large ‘triangle’. We now favour a slow sideways move over the next week or two, here and in a whole range of other Yen crosses.
Strategy: Possibly attempt small shorts at 133.65; stop well above 133.75. Add to shorts on a sustained break below 130.90 for 129.50 short term.
GBP
Comment: From most reviled to favourite son in the space of six months as many re-think and cut Sterling positions. Yesterday’s ‘spike high’ after the ‘spike low/doji’ candles the two previous days underline the fact this market is looking for direction. Cable is overbought but bullish momentum is stronger than it has been since December 2006, there is little point messing around.
Strategy: Buy at 1.5935, adding to 1.5800; stop well below 1.5700. Add to longs on a sustained break above 1.6100 for 1.6200 short term, then 1.6500.
JPY
Comment: Getting a lot more difficult and messy as we rally strongly from fairly pivotal support roughly between 94.00 and 94.50 into a very large Ichimoku ‘cloud’ with moving averages suggesting a short. Hopefully the rally will stall around the 26-day average at 96.83.
Strategy: Attempt small shorts at 96.55; stop above 97.00. First target 96.00, then 95.00.
