EUR
Comment: Very slow work as the Euro tries to form an interim base against 50% Fibonacci retracement support. Momentum is neutral and very good futures volume on Tuesday’s fall underlines the fact that consensus opinion is for a weaker Euro.
Strategy: Attempt small longs at 1.2695; stop below 1.2575. First target 1.2775, then 1.2900.
EUR/JPY
Comment: Consolidating below the bottom of the ‘triangle’ and set to re-test August’s low of 105.44. Many yen crosses are doing something similar, a fact which should reinforce the moves lower. The Euro is still not oversold against the yen and momentum is bearish but not especially strong. Expect more cautious downside testing today and maybe all month.
Strategy: Attempt shorts at 106.15, adding to 107.00; stop above 108.00. First target 105.50, then 104.25.
GBP
Comment: Perking up a bit, rallying suddenly from 38% Fibonacci retracement support and closing above the 9-day moving average. We continue to feel that Cable is trying to put in a new interim low and will hopefully scramble up to 1.5700 helped by the daily Ichimoku ‘cloud’.
Strategy: Attempt longs at 1.5440; stop well below 1.5290. First target 1.5535, then 1.5600.
JPY
Comment: Holding neatly inside the narrow ‘channel’ as all elements of this chart suggest a short position. The US dollar not especially oversold against the yen and on-balance volume in the futures contracts is at a new record. Bearish momentum remains steady if unspectacular. The market has got to get used to sub-85.00 prices.
Strategy: Attempt shorts at 83.65/84.00; stop above 84.95. First target 83.00/82.80, then 81.95/81.50.
