Retail Sales was the star of North American Trading. The print came in better than expected, placing a blow to QE hopes in the near future. The reaction to the data pushed treasury yields higher propelling the USDJPY out of the comfort of the range that has contained it over the last few weeks. Heading into Asian and European trading all eyes will be on the NZDUSD, AUDUSD and EURUSD as all three pairs are resting on significant support levels heading into the New York close. A break of these levels could expose the majors to a move lower against the dollar. Of course a hold at these level could lead to a push higher in the short-term. Price action near these levels will be telling. Heading into European trading the data point of interest will be the GBP Bank of England minutes and Jobless claims report. A reading of a gain of 6K is expected with the rate remaining at 8.1%. Traders should also keep in mind that the USD CPI report in due in early New York Trading Wednesday. As always keep your trades KEANE and play it tight.
EURUSD SUPPORT IT IS
The EURUSD is comfortable once again in the range that held it for most of last week. Support is at 1.2354 and resistance is at 1.2440. The pair is challenging the bottom of the range. But has had difficulty finding the momentum to push lower. The longer the pair remains above 1.2330 the more likely the cross pushes higher. A break below exposes the 1.2240 level.
Sup 1.23330 1.2240
Keane Plan: The 1.2330 level is key. A break below exposes 1.2240. A hold opens the pair up for a run towards 1.2440
GBPUSD HOLDING ITS FIBS
The GBPUSD has traveled in a narrow range so far this week. Things may change Wednesday with the release of the Bank of England Minutes along with Jobless Claims at 4:30 ET. The Jobless Claim results are estimated to come in around 6K and the unemployment rate at 8.1%. A surprise in these numbers could shack the pair from its current wistfulness. The pair is still playing between the Fibs from the moves in May. The .382 fib at 1.5660 is acting as support and the .50 fib at 1.5782 is acting as resistance.
Keane Plan: Playing in between the fibs. Keeping an eye on Wednesday’s Jobless claims.
AUDUSD FLIRTING WITH 1.05
The AUDUSD is walking a straight line around the 1.05 level. A little too much here or not enough there could push the pair over the edge. The cross pushed below 1.05 briefly in New York Tuesday but could not gain momentum for a push lower. Support for the pair rest between the 1.05 level and the ascending trend line around 1.0480. A confirmed break of that level could lead to a push towards 1.0430. Resistance still rest around the 1.06 level followed by 1.0630.
Sup 1.05/ 1.0470
Res 1.06 1.0630
Keane Plan: Watching price action around 1.05 for a hint towards direction.
NZDUSD BREAKING MONTHLY LOWS
The NZDUSD broke lower on Tuesday to test the monthly lows. Support at .8060 is currently under attack. A hold or break of this level will dictate future price action. A hold at .8060 exposes a move back towards .8235. A break below .8060 opens up the pair to a move lower towards .80 followed by .7860.
Keane Plan: Monthly lows are broken but follow through has been mute. Watch price action around .8060.
USDCAD BALANCING ON .99
The USDCAD is still hanging around the .99 level. The pair doesn’t appear to be in a rush to move up or down. The cross is still currently below channel support. The only substantial data out regarding the CAD this week is the CPI report on Friday. Until that point the USDCAD should move with general risk trends. A break below .99 exposes the .98 level. Resistance begins at .9970 followed by parity.
USDJPY BROKE THE RANGE!!!!
The USDJPY did the impossible today. No, no the unthinkable. The pair strapped its saddle to stronger than expected Retail Sales results from the USD a pushed above the range that has contained it over the last three weeks. The question now is where can the pair go from here. The positive Retail Sales number diminished the possibility of QE3 being announced at the upcoming Jackson Hole Summit. Thus increasing treasury yields and the USDJPY. If at the end of the month NFP surprises higher the USDJPY could be ready to start a trend higher. In the meantime support is now past resistance at 78.70 and targets to the upside are 79.15 followed by 80.
Res 79.15 80
Keane Plan: As long as the pair remains above 78.70 a move higher towards 79.15 could be in the works