• Home ::
• Technical ::
• Market View ::
• Daily Technical Outlook

• Send
• Print
• Add To

Daily Technical Outlook

90490af8-a76f-4018-8a9f-fb1fad7ce344

0

0

Daily Technical Outlook

Thu, Jun 5 2008, 13:02 GMT
by William Basa

Global Market Research, Inc. (GMR)

OVERVIEW:

Sterling continues to breakdown in slow, but steady fashion. The week’s action under the June pivot area at 1.9765/90 to 1.9870, the close under bullish-leaning weekly trend at 1.9660/55 and open-ended downside on the developing weekly chart below 1.9645/85 all point lower. Will look to set partial shorts against 1.9645/85 for decline to monthly base at 1.9120. Euro has a similar intramonth breakdown gap under June/weekly zone at 1.5430/05 to 1.5115/00. The other major trade yesterday was the push higher in $/CAD, challenging the June/Q3 resistance/sell structure at 1.0160/66.

JPY/USD

Weekly Outlook – Neutral. The tight, inside range this week hasn’t changed much here. Weekly trend is going to stay neutral (though it can lean bullish above 104.57/44 next week), with an overall neutral setup. The fact the resistance barrier is comprised of longer-term levels – 105.54 June hurdle, 105.85 Q2 and 106.35/82 Q3/June zone – keeps it unchanged. Supports for next week are forming at 104.57/44 trend, 103.35 and 102.53/50 monthly trend. Will add/hold shorts against 106.35/82; cover at 102.50.

Daily Comments – Neutral. Daily trend is still neutral and the setup today is largely balanced. Main support is the combined developing weekly/day zone from 104.57 to 104.44/37. Under there is drop to 103.56/53. Day resistance is 105.21, then the June level at 105.54 and Q2 level at 105.85. Expecting a two-way day from 104.57/37 to 105.54.

Position Strategy: Currently 50% short at 105.69 average. Add to 75% short at 106.35; 100% short at 106.82 – stop on close above. Cover shorts at 102.54/50 this week. Day Trade: sell 105.21 and 105.54; buy 104.44/33.

CHF/USD

Weekly Outlook – Neutral. Still no change here, with both weekly trend and setup looking to remain neutral and balanced for next week. Resistance is forming at 1.0500 for the week, with the initial June hurdle still at 1.0540. Getting above there triggers upside extension to the larger Q3/June sell zone at 1.0715 to 1.0785. Support for next week is 1.0320, the monthly trend base for June at 1.0250/25 and 1.0015. Expecting more range action from 1.0250/20 to 1.0540.

Daily Comments – Neutral to bearish. Daily trend does lean bearish today, but with an overall neutral setup that should likely produce two-way trade. Main support is combined daily/developing weekly zone at 1.0330/20 and the 1.0250 June buy level. Resistance is 1.0415/20, 1.0460 and developing weekly level at 1.0500. Projecting a 1.0330/20 to 1.0460 day range.

Position Strategy: Currently 25% long at 1.0215/00. On weakness, add to 50% long at 1.0250/25 – stop on close under 1.0220. On strength, exit longs at 1.0540. Day Trade: buy 1.0330/20; exit day longs at 1.0460 and 1.0500.

Pound

Weekly Outlook – Neutral to bearish. Sterling is starting to breakdown in earnest once again. The market is now well under the pivotal June zone at 1.9765/90 to 1.9870, weekly trend is going to stay neutral with any settle under 1.9660/55 Friday, and the developing weekly setup is open-ended below 1.9645. Although there remains a current weekly extreme at 1.9490/80, the likely target is June level at 1.9120. Resistance for next week is 1.9645, 1.9685/95 and June levels at 1.9765/90 and 1.9870. Will sell 1.9645/95 for now.

Daily Comments – Neutral to bearish. Daily trend can turn bearish with settle under 1.9630/35 today, and the setup poins lower. Resistance is 1.9555, then combined daily/weekly sell zones at 1.9630/45 and 1.9680/95. Main support is 1.9490/80, then 1.9430. Expecting a 1.9630 to 1.9490/80 day.

Position Strategy: Currently flat. Move 50% short on close under 1.5400 (limit 1.5370). The target is 1.5115/00. Day Trade: sell 1.5490/1.5505; also go with break under 1.5405/00.

CAD/USD

Weekly Outlook – Neutral. This has been a powerful rally in $/CAD this week that has the potential to reverse weekly trend bullish with settle above 1.0124 this Friday. Still, until the market sustains above the combined June and developing Q3 resistance at 1.0160/66, the setup is neutral. That remains the primary sell zone. A close above there sees gap to 1.0246 next week and 1.0332 for June. Supports for next week are 1.0036 and .9978/62 developing weekly trend. Hold shorts against 1.0166.

Daily Comments – Bullish to neutral. The day trade is a battle between bullish daily trend at 1.0055/52 and the key Q3/June hurdle at 1.0160/66. If that is cleared, intraday upside jumps to 1.0246 and 1.0299. Initial support is 1.0129, with the daily trend/weekly zone at 1.0055/36. Expect a 1.0166 to 1.0055 day range.

Position Strategy: Currently 50% short at 1.0160/66 June/Q3 zone from late Wednesday. Stop on close above 1.0166. Day Trade: sell 1.0166 and 1.0246, separately; buy 1.0055/52/36.

Australian Dollar

Weekly Outlook – Bullish to neutral. Weekly momentum will stay bullish with any settle above .9540 Friday, and the market has done an able job staying above the initial June support at .9511. At this point, the setup for next week looks neutral to positive. Supports are forming at .9575 trend, .9522/11 and .9445, with deeper monthly uptrend at .9404 to .9339. Main weekly resistance is high at .9715 and the June breakout of .9762. Expecting .9522/11 to .9715/62 range action.

Daily Comments – Neutral. Daily trend turned from bearish to neutral yesterday, with the outside range leaving a widespread setup. Support are .9548, weekly/June zone at .9522/11 and .9471. Resistance is .9627, .9652 and .9715 developing weekly level. Expecting a .9522 to .9627/52 day range.

Position Strategy: Current flat after stopping longs on intraday break of .9490 Wednesday. Will wait to reset longs at .9404 and .9339. . Day Trade: buy .9522/11; sell .9627/52.

• Download Full Daily Technical Outlook

Published on  Thu, Jun 5 2008, 13:12 GMT