EUR
Comment: Stopped dead in its tracks at the middle of the previous consolidation pattern. The Euro is no longer overbought and one-month at-the-money implied volatility has picked up a little. We shall continue to watch for basing activity for a rally later this month.
Strategy: Possibly attempt longs at 1.4130; stop well below 1.4100. Short term target 1.4300, then 1.4400.
EUR/JPY
Comment: A potential ‘bearish engulfing’ weekly candle close to this year’s peak, but we will have to wait until Friday evening for confirmation. We shall continue to watch for signs of topping and reversing, here and in all Yen crosses which must confirm each other.
Strategy: Attempt shorts at 135.00, adding to 136.55; stop above 138.00. Short term targets 134.00, maybe 133.00/132.50.
GBP
Comment: Yesterday’s tiny little range in the middle of the ‘triangle’ that has dominated since May is most odd. Moving averages are still bullish and we are trading above a large Ichimoku ‘cloud’ so we shall continue to watch for signs of basing this week.
Strategy: Possibly attempt small longs at 1.6445; stop well below 1.6400. First target 1.6600, then 1.7000.
JPY
Comment: Retracing all of Friday’s rally, dropping into a strangely-shaped Ichimoku ‘cloud’, and potentially a strong reversal formation on the weekly charts here and in many Yen crosses. While the US dollar is no longer overbought, we continue to look for interim tops to form in many currency pairs against the Yen, continuing in the series of broadly sideways moves that have dominated all year.
Strategy: Attempt shorts at 95.50 but only if prepared to add to 96.50; stop well above 97.00. Short term target 95.00, then 94.00/93.55.
