EUR
Comment: Still struggling with recent highs around 1.3800 as the Euro remains everyone’s pet hate. Moving averages have crossed to bullish and will hopefully limit the downside. Other currencies are leading by a long chalk and this is unlikely to change soon.
Strategy: Buy at 1.3615; stop below 1.3500. Add to longs on a sustained break above 1.3840 for 1.3900, then 1.4000.
EUR/JPY
Comment: Yen crosses remain, and are likely to continue, to be difficult and directionless. Prepare to be very flexible and trade the broad ranges established since the beginning of this year.
Strategy: Sell at 123.15 but only if prepared to add to 124.00; stop above 125.45. First target 122.50.
GBP
Comment: Struggling with the top of the potential ‘flag’ formation and the 26-day moving average. We still feel Cable 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’. A weekly close around 1.5200 would form a weekly ‘doji’ following the previous two ‘hammers’, underlining the fact it is trying to base, as is the Euro.
Strategy: Buy at 1.5185; stop below 1.4950. Add to longs on a sustained break above 1.5425 for 1.5600.
JPY
Comment: This market is looking for direction as it hovers at a tiny Ichimoku ‘cloud’, with sharp sudden intra-day moves ending in a large ‘doji’ yesterday. Expect a little more hesitation at current levels this morning and then a drop, with a sustained move below 90.00 probably cancelling out any remaining bullish momentum. Yen crosses are likely to continue very mixed as their moves will tend to be dominated not by the yen but by the other currency.
Strategy: Sell at 90.45; stop above 91.15. First downside target 90.00, then 89.30/89.00.
