EUR
Comment: A proper break higher, at last! The daily close above 1.4350 has added to bullish momentum, as would a weekly close above 1.4550. Daily and weekly Ichimoku ‘clouds’ should provided underlying support to the Euro for weeks to come, and as other currencies strengthen against the US dollar it should help the Euro higher too.
Strategy: Buy at 1.4500; stop below 1.4325. Add to longs on a break above 1.4550 and again above 1.4635 for 1.5000 medium term.
EUR/JPY
Comment: Sidelined as the spotlight is very much on the US dollar. Still hovering at the thin point of the Ichimoku ‘cloud’ – which is getting wider towards month-end. Watch for signs of stalling.
Strategy: Attempt shorts at 134.00; stop above 134.25. Short term target 133.00, then 132.00.
GBP
Comment: Rallying from the lower edge of a thin Ichimoku ‘cloud’ as Cable gets dragged higher by other currencies that are gaining against the US dollar. A daily close above the top of the ‘cloud’ and the 26-day moving average at 1.6579 should turn momentum bullish.
Strategy: Buy at 1.6550; stop below 1.6400. First target 1.6600, then 1.6745.
JPY
Comment: Dropping from the nine-day moving average as we prepare for a re-test of July’s low at 91.73. The US dollar is not oversold and momentum is just bearish, longer term averages also suggesting a short position. An eventual break below 91.50 should see implied at-the-money volatility increase significantly as we approach January’s low at 87.10.
Strategy: Sell at 92.35, adding to 92.85; stop above 93.50. Short term target 92.00/91.75, then lower still.
