EUR
Comment: Sharp intra-day moves on nothing in particular should remind the complacent that this is not a one-way street, keeping the bid tone to implied volatility. Expect consolidation under this week’s high at 1.4339 but note that yesterday’s strong bounce from the 9-day moving average at 1.4064 has kept bullish momentum as steady as it has been for a month. A weekly close above 1.4200 should add to this.
Strategy: Attempt longs at 1.4200/1.4165; stop well below 1.4000. Short term target 1.4230, then 1.4330/1.4360.
EUR/JPY
Comment: Yen crosses remain extremely difficult and probably best avoided if possible. Hovering just below a new high for this year at 138.02, above April’s at 137.42. This suggests Yen crosses will move cautiously either side of recent highs.
Strategy: Possibly attempt tiny shorts at 137.30; stop above 138.15 Short term target 135.30, maybe 134.00.
GBP
Comment: Retreating from this week’s high but still well within normal retracement parameters. Two-way price action has kept the bid tone to implied volatility, seen the overbought situation collapse, though bullish momentum is still stronger than it has been in three years.
Strategy: Attempt small longs at 1.6090; stop below 1.6000. First target 1.6400/1.6450.
JPY
Comment: Still within the range of the last six days and hopefully prices will be capped by the lower edge of the Ichimoku ‘cloud’ and the 26-day moving average at 96.83. Expect a drop to yesterday’s low and the 9-day average at 95.84. Only a weekly close below 94.00 completes a ‘head-and-shoulders’ top formation.
Strategy: Attempt small shorts at 96.75; stop above 97.35. First target 95.85 then 95.00.
