EUR
Comment: Testing the top of the ‘triangle’ after rallying from the upper edge of the daily Ichimoku ‘cloud’. If not today then next week we favour a break higher, where a weekly close above 1.4200 should add considerably to bullish momentum and trigger a series of waves of stop loss buying.
Strategy: Attempt small longs at 1.4075; stop below 1.3800. Short term target 1.4100/1.4135, then 1.4200.
EUR/JPY
Comment: Retracing half of previous declines, quite a bit more than we had allowed for, yet nevertheless we feel the move ought to stall now. Implied volatility should move a lot higher.
Strategy: Attempt small shorts at 132.25; stop well above 133.40. Short term target 131.00, then 128.00.
GBP
Comment: Rallying slowly again after the Monday’s ‘hammer’ candle ahead of the top of the Ichimoku ‘cloud’ and the bottom of the ‘triangle’. Expect a test of the top of the formation this week.
Strategy: Attempt small longs at 1.6400, adding to 1.6300; stop below 1.6155. First target 1.6470/1.6500, then 1.6600.
JPY
Comment: A corrective rally to the ‘neckline’ of a sort-of ‘head-and-shoulders’ top and the 9-day moving average. This has eased the oversold situation very considerably though momentum is still clearly bearish. Expect more hesitation at current levels today prior to a drop tomorrow and into next week.
Strategy: Attempt shorts at 93.85; stop above 94.55. Cover between 93.00 and 92.50.
