Most of the foreign currencies futures edged lower in the Far East after rising on Tuesday, and this signals a yoyo market for the European and commodity currencies. The Asia/Pacific stock markets are mostly up, while oil and gold are both up.
The short-term outlook remains bullish for the European and commodity currencies and sideways for the yen, but the weakness in the former worries me a little. The medium-term outlook is sideways for the European currencies and the yen and bullish for the commodity currencies. My model is long all of the foreign currencies futures except for the yen.
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Analysis based on:“Trading in the Global Currency Markets” - Prentice Hall Press, 3rd edition 2007“Technical Analysis Applications” - McGraw-Hill, 2004Overnight:
- Australia: Leading economic indicators rose 0.2% to a reading of 255.7 in January. The coincident index increased 0.8% to a reading of 247.8 in January.
- Japan: The tertiary industry index rose 2.9% in January following the 0.9% contraction in December.
- Japan: The BoJ left its interest rates unchanged at .1%
Today’s economic calendar:
- Eurozone: Construction output for January
- Eurozone: Labor costs for the fourth quarter
- UK: Bank of England minutes
- UK: ILO unemployment rate for January
Luca Model: Long since February 26
The June euro slipped in the Far East after rallying on Tuesday. It is now retesting the resistance of the trendline declining since December 3. In essence, the euro has been alternating up and down days for the past four days above this average. The short-term outlook is slightly bullish. The medium-term outlook is sideways and my model is long.
Immediate resistance is at 1.3796. The next caps are 1.3853 and 1.3900.
Initial support is 1.3731. The 21-day moving average supports at 1.3693. This is followed by 1.3600.
INDICATORS
Fast stochastics: Bullish
MACD: Bullish
Ichimoku: Bearish
OUTLOOK
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Sideways
LONG-TERM: Bearish
JPY - March
Luca Model: Short since March 5
The June Japanese yen edged lower in Asia after rallying on Tuesday to a one-week high. The short-term outlook is sideways. The medium-term outlook remains sideways and my model is short.
Initial support is at 110.18. Below 109.84, distant support lies at 109.24.
The 21-day moving average caps at 111.03. Above 111.56, distant resistance is at 112.49.
INDICATORS
Fast stochastics: Sideways
MACD: Bearish
Ichimoku: Sideways
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Sideways
LONG-TERM: BullishGBP - March
Luca Model: Long since March 11
The June pound saw mild weakness in the Far East after rallying on Tuesday. The short-term outlook remains bullish, but this will hold true only if the pound can penetrate convincingly above the 21-day moving average at 1.5242. The medium-term outlook is sideways and my model is long.
Initial resistance is 1.5286. The next caps are 1.5325 and 1.5412.
Immediate support is at 1.5198. The next supports are 1.5103, 1.5060, 1.5010 and 1.4970.
INDICATORS
Fast stochastics: Bullish (overbought)
MACD: Slightly bullish
Ichimoku: Sideways
OUTLOOK
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Sideways
LONG-TERM: Bearish
CHF - March
Luca Model: Long since February 26
The June Swiss franc slipped in Asia after rallying on Tuesday. It is still challenging the bottom of the Ichimoku cloud. The short-term outlook is bullish. The medium-term outlook is sideways and my model is long.
Immediate resistance is at .9514. Further resistance is at .9557 and .9603.
Initial support is at .9462 from the 55-day moving average .9390. The 21-day moving average follows at .9380. Distant support is at .9250.
INDICATORS
Fast stochastics: Bullish
MACD: Bullish
Ichimoku: Bearish
OUTLOOK
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Sideways
LONG-TERM: Bearish
CAD – March
Luca Model: Long since February 26
The overbought June Canadian dollar remained firm in the Far East after rallying on Tuesday to a new high for the uptrend. The short-term outlook is bullish. The medium-term outlook is bullish and my model is long.
Nearby resistance is .9872. Above .9930, further resistance is seen at .9970.
Immediate support is at .9828. Further support is at .9776, .9730 and .9690 from the 21-day moving average.
INDICATORS
Fast stochastics: Sideways (overbought)
MACD: Bullish
Ichimoku: Slightly bearish
OUTLOOK
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
AUD – March
Luca Model: Long since February 26
The June Australian dollar slipped in Asia after rallying on Tuesday. The short-term outlook is slightly bullish. The medium-term outlook is bullish and my model is long.
Initial resistance is at .9103. Strong resistance follows at .9218. The top of the uptrend is .9275.
Below .9034, the 21-day moving average follows at .8968. Further support is at .8885.
INDICATORS
Fast stochastics: Sideways (overbought)
MACD: Bullish
Ichimoku: Sideways
OUTLOOK
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
