EUR
Comment: Struggling at February’s high at 1.3840, the highest point of what looks increasingly like a ‘rounded bottom’. Note however that moving averages have crossed to bullish and perhaps the 9-day one will add some much needed bullish momentum. Yesterday’s drop is 38% of the rally from this month’s low at 1.3433, so watch for signs of stabilising here today.
Strategy: Attempt longs at 1.3690/1.3660; stop below 1.3500. Add to longs on a sustained break above 1.3800 for 1.3840, then 1.3900.
EUR/JPY
Comment: Dropping neatly from 125.00, the upper edge of the range since February and retracement resistance. Note however that moving averages have turned bullish so very mixed signals – something we would expect for a market that is likely to go sideways for another month or so. Continue to trade the range.
Strategy: Sell at 123.30, adding to 124.00; stop above 125.45. Next target 122.00.
GBP
Comment: Sterling and all things UK very much at risk from political sentiment and investor skittishness. Cable is working in a potential ‘flag’ formation though propped up by the 9-day moving average – so mixed signals. We still feel it is trying to form an important medium term low point, but remains very vulnerable here, and against all other currencies, to a sudden very large ‘spike’.
Strategy: Attempt small longs at 1.5055; stop below 1.4850. Add to longs on a sustained break above 1.5225 for 1.5300 and then more.
JPY
Comment: Small signs of topping against 91.00 (high 91.09) as prices drop below the top of the (admittedly small) Ichimoku ‘cloud’. Expect a little hesitation at current levels this morning and maybe all day prior to a drop to the flat bottom of the ‘cloud’ at 89.30 tomorrow.
Strategy: Sell at 90.10, adding to 90.50; stop above 91.15. First downside target 89.60, then 89.30/89.00
