EUR
Comment: Can anyone spot a ‘black swan’? The Euro is consolidating at the very top of this year’s range, is not overbought (though bullish momentum could be stronger) so expect another burst higher hopefully by the end of this week. Our measured targets are 1.4600 and eventually the psychological 1.5000.
Strategy: Attempt longs at 1.4400, adding to 1.4360; stop well below 1.4200. Short term target 1.4435, then 1.4545 and after that 1.4635.
EUR/JPY
Comment: Hovering slightly unsteadily at some of this year’s highest levels, overbought with declining bullish momentum. Who knows where it will end, but it will be messy, and we are very wary of upside breaks in some other currency pairs (namely AUD/JPY, BRL/JPY, CAD/JPY, NOK/JPY and NZD/JPY where some may say there is an element of catch-up). Stand aside if possible.
Strategy: Possibly attempt tiny shorts at 137.00; stop above 137.75. Short term target 136.00, maybe 133.50.
GBP
Comment: Perched at the psychological 1.7000 level as many look on in amazement at the pound, late to the party as volume and open interest in the futures increase. Our measured targets remain at 1.7100 then 1.7500. Careful though as it is almost overbought and bullish momentum is not nearly as strong as many would hope.
Strategy: Attempt longs at 1.6995 but only if prepared to add to 1.6800; stop well below 1.6700. First target 1.7044 again, then 1.710/1.71250 and after that 1.7500.
JPY
Comment: Nothing to add as we continue to struggle above moving averages and below a descending Ichimoku ‘cloud’. Be careful as many of these look over-extended. The Lagging Span is holding under the candles which drop dramatically in two days’ time. We continue to favour generalised US dollar weakness and therefore eventually dollar/yen ought to move lower.
Strategy: Attempt shorts at 95.15; stop above 96.00. Short term target 94.15, then 93.00.
