EUR
Comment: Generalised US dollar weakness has seen the Euro edge up to a new high for the year, 1.4689 so far this morning. The Euro is overbought bought who cares when so many have been wrong-footed and must re-think long dollar holdings.
Strategy: Buy at 1.4680, adding to 1.4600; stop well below 1.4500. Add to longs on a break above 1.4700 for 1.5000 medium term.
EUR/JPY
Comment: Little to add as we stall near the lower edge of the daily Ichimoku ‘cloud’. We expect this to limit this latest bounce, hopefully starting a series of lower highs, for another downside probe later this week.
Strategy: Attempt shorts at 133.15; stop above 134.50. Add to shorts below 132.75 for 131.00 short term.
GBP
Comment: Struggling badly with the daily Ichimoku ‘cloud’ as sterling is the worst performing currency except the US dollar. Allow for more hesitation inside the ‘cloud’ today, noting that only a sustained break above 1.6750 will kick-start a squeeze to 1.6800, and eventually a rally through this year’s high at 1.7044. Moving averages have turned bullish and Cable is not in the least bit overbought.
Strategy: Buy at 1.6470; stop below 1.6300. First target 1.6740, then 1.7000 again.
JPY
Comment: Stalling with a ‘shooting star’ candle ahead of trendline resistance and the 9-day moving average that has limited the daily highs since mid-August. Hopefully this marks a new interim high and over the coming weeks we will see a series of repeated downside tests of critical support between 87.00 and 85.00. The US dollar is no longer oversold against the Yen.
Strategy: Attempt small shorts at 90.90/91.25; stop well above 91.65. Short term target 90.20/90.00, then 89.00 and probably a sudden push to 87.10.
