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Daily Technical Outlook

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Daily Technical Outlook

Tue, Jun 10 2008, 06:11 GMT
by William Basa

Global Market Research, Inc. (GMR)

OVERVIEW:

There are no easy trades in the USD at this point. Weekly trend in $/JPY still leans bullish above 104.57/53, and is pushing against its Q3/June sell zone at 106.35/82 – the focus for today. In Euro, Monday’s big retreat didn’t change a lot. Main supports are still 1.5515 and 1.5430/05 for the week, with resistance target sill 1.5930/65. Sterling is battling against its June/Q3 levels at 1.9765/90 and 1.9870, the latter a place to reset shorts against. Aussie faded back under both weekly uptrend and initial June support at .9511 yesterday. Expecting to now test monthly uptrend at .9404/.9339.

JPY/USD

Weekly Outlook – Neutral to bullish. Still a battle here between bullish-leaning weekly trend at 104.57/53 and the larger Q3/June resistance at 105.35 to 106.82. A weekly level is also at 107.03, before upside jumps more sharply to 109.75 for the week. Other than 104.57/53, support drops back to weekly/June base at 102.63/50 and 101.85. Still projecting a two-way week from 106.82/107.03 high to 102.63 low. Will add/hold shorts against the 106.82/107.03 zone.

Daily Comments – Neutral. Daily trend remains neutral, with Friday and Monday’s opposite directional moves offsetting each other. The day setup is balanced. Supports today are 105.58, 104.90 and weekly/day zone at 104.57/41. Day resistance is 106.63, with longer-term levels at 106.35 (Q3) and 106.82 (June) to either side. Expecting a 104.90 to 106.63 day range.

Position Strategy: Currently 75% short at 105.98 average. Add to 100% short at 106.82 – stop on close above 107.03. Cover 1/3rd of current short (25%) at 104.57/52 weekly trend; rest at 102.63/50 June base.

CHF/USD

Weekly Outlook – Neutral. Weekly trend is neutral, with an overall neutral setup as long as 1.0160/40 support holds. Monday’s trade also saw a rebound back above the June trend zone at 1.0250/25. Resistance is 1.0345, 1.0505 and the weekly/June sell zone at 1.0525/40. Bearish daily trend also intersects at 1.0305/20 today. Below 1.0140 sees drop to .9985 June level and .9835 weekly extreme. Expecting a 1.0345 to .9985 week. Strategy for now is to wait to sell 1.0525/40 for decline to .9985.

Daily Comments – Bearish to neutral. The battle today is once again between bearish daily trend – at 1.0305/20 today – and the key weekly breakdown support at 1.0160/40. Day supports are also at 1.0160 and 1.0110, before drop to .9985. Resistance is 1.0305/20 trend and 1.0380. Projecting a two-way day with 1.0320 high and 1.0160/40 low.

Position Strategy: Currently flat. Move 50% short at 1.0525/40 – stop on close above 1.0550. Day Trade: sell strength to 1.0305/20 daily trend and 1.0345 weekly level; cover day shorts at 1.0160/40.

Pound

Weekly Outlook – Bullish to neutral. No change Monday. Weekly trend is officially bullish, but effectively neutral until the June resistance at 1.9765/90 or Q3 level at 1.9870 is cleared. Both held Monday’s rally. Above 1.9860/70 is additional weekly level at 1.9955 before upside gap to 2.0220. Supports for the week are 1.9685/45 – which also contained Monday’s early weakness – before drop to 1.9240. Still projecting a 1.9870 to 1.9240 weekly range. Will sell 1.9860/70 to cover at 1.9240.

Daily Comments – Neutral to bullish. Daily trend leans bullish with close above 1.9640/20 today. At the same time, upside is still limited by the June zone at 1.9765/90 and Q3 level at 1.9870. Day resistance matches up with both sides at 1.9790 and 1.9865 above; 1.9640/20 trend support below. Expecting a 1.9640 to 1.9790 day range.

Position Strategy: Currently flat. Move to 50% short at 1.9860/70 – stop on close above 1.9955 weekly level. Target is 1.9240 this week. Day Trade: sell 1.9765 and 1.9790; buy 1.9645/40 to 1.9620.

European Currency Unit

Weekly Outlook – Bullish to neutral. Although Euro faded lower yesterday, weekly trend remains bullish and the market is still above the 1.5625/20 monthly pivot ceiling. As long as that area holds, there remains no resistance until weekly/June zone at 1.5935 to 1.5960 – still the weekly target. Supports for the week are 1.5650 weekly trend, 1.5515 and the monthly/weekly breakdown zone at 1.5430/05. Projecting a 1.5515 to 1.5935/60 week. Strategy remains to wait to buy 1.5430/05; wait to sell 1.5960.

Daily Comments – Bullish to neutral. Daily trend remains bullish, but Monday’s backtrack leaves a neutral setup. The early keys to direction today are weekly trend/day zone from 1.5650/45 to 1.5665/70. Under there is drop to weekly level at 1.5515 and 1.5460/40. Above there is weekly resistance at 1.57435 and 1.5910 day extreme. Projecting a 1.5515 to 1.5745 day.

Position Strategy: Currently flat. Move 50% long at 1.5430/05 – stop on close under 1.5400. On strength, move 25% short at 1.5935; 50% short at 1.5960 – stop on close above 1.5975.

CAD/USD

Weekly Outlook – Bullish to neutral. Weekly momentum remains bullish from last week’s reversal higher – but with overall neutral setup due to deep weekly supports. Resistance for the week is 1.0246, the June level at 1.0332 and 1.0473. Weekly supports are well back at 1.0036/24 and .9978 weekly uptrend. There is both bullish daily trend (1.0191) and the Q3 level at 1.0166/60 ahead of there. Expecting a 1.0246 to 1.0036/24 weekly range. Will set partial shorts at 1.0332; buy 1.0036/24.

Daily Comments – Bullish to neutral. Daily trend is still bullish, but slowing. The day setup is neutral due to Monday’s outside range and the weekly level at 1.0246. Resistance today is 1.0235/46 to 1.0261, then jump to 1.1332 June sell level. Supports are 1.0191 daily trend, 1.0141/35 and 1.0073. Expecting a range day from 1.0246 to 1.0141.

Position Strategy: Currently flat. On weakness, wait to move 50% long at 1.0036/24 – stop on close under .9975. On strength, move 50% short at 1.0323/32 – stop on close above there. Day Trade: buy 1.0141/35; sell 1.0246/61.

Australian Dollar

Weekly Outlook – Neutral. It was an eventful day Monday, with the close under the weekly/June zone at .9516/11 and the bearish reversal in daily trend. Combined, they remove any bullish bias for the week and signal a rotation lower to test the bullish the monthly trend base at .9404 to .9339. There is a weekly level at .9445 ahead of there. Resistance is now bearish daily trend at .9571, then the weekly levels at 1.9652 and .9680. The new weekly range is seen from .9652/80 to .9404. Will set partial longs at .9404 and .9339.

Daily Comments – Bearish to neutral. Daily trend is bearish, with a neutral to modestly negative setup. Supports are the weekly level at .9445 and the first buy zone at deeper June support of .9404 (and day level at .9405). Resistance is daily downtrend at .9571 and the high daily/weekly zone at .9650/59. Expecting a .9571 to .9445 day range.

Position Strategy: Current flat. On weakness, move 25% long at .9405/04 today; 50% long at .9339/24 – stop on close under .9330. Day Trade: sell against .9571 daily downtrend; buy .9445 and .9405/04.

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Published on  Tue, Jun 10 2008, 11:03 GMT