The foreign currencies strengthened further in the Far East after all but the Canadian dollar surged on Wednesday on expectations that the Fed will ease and that the ECB will curb surging peripheral Eurozone borrowing costs and keep Greece afloat. The Asian stock markets advanced.

The short-term outlook for most foreign currencies is sideways to slightly bullish. The medium-term outlook for most of the foreign currencies is sideways. The LGR short-term model is long across the board.

Good luck!

 

Overnight

  • China: The leading economic index slipped to 236.4 in July from  234.8 in June. 
  • China: HSBC manufacturing PMI for August

 

Today's economic calendar

  • Eurozone: Markit PMI Composite for August - preliminary  
  • Eurozone: Consumer confidence for August 
  • Germany: Gross Domestic Product  for the second quarter 
  • Switzerland: Trade balance for July 
  • UK: BBA mortgage approvals for July 
  • UK: CBI distributive trades survey - realized for August 
         
     

EUR – September

Luca Model: Long since August 3        
 
The September euro remains strong at a 1 ½-month high after surging for two days. The euro is trading above the 55-day exponential moving average. The euro had bottomed an over two-year low last week, but should remain under overall pressure.
The short-term outlook is sideways to slightly bullish. The medium-term outlook is sideways and my model is long.
Initial resistance is at 1.2600. Further resistance is at 1.2705.
Immediate support is at 1.2465. The 55-day exponential moving average supports at 1.2437 and the 21-day exponential moving average at 1.2373. 

INDICATORS

Fast stochastics: Bullish
MACD: Slightly bullish
Ichimoku: Slightly bullish


OUTLOOK

NEAR-TERM: Sideways to slightly bullish       
MEDIUM-TERM: Sideways
LONG-TERM: Bearish

 

JPY – September

Luca Model: Long since August 22             
 
The September Japanese yen edged lower after exploding to a nine-day high on ongoing short covering. It had bottomed at a five-week low on Monday. The yen closed above the 21-day exponentially smoothed moving average. It is trading in a symmetrical triangle.
The short-term outlook is sideways. The medium-term outlook is sideways and my model went long.
The 21-day exponential moving average supports at 1.2697.  Monday’s low is 1.2556. 
Immediate resistance is at 1.2780. The next resistance is 1.2854.

INDICATORS

Fast stochastics: Bullish  
MACD: Slightly bearish
Ichimoku: Sideways


OUTLOOK

NEAR-TERM: Sideways 
MEDIUM-TERM: Sideways  
LONG-TERM: Sideways  

 

GBP – September

Luca Model: Long since July 19                  

The September pound is marching higher to a three-month high. The pound broke the top of a symmetrical triangle. The pound had formed a medium-term peak at an eight-month high on April 30 and a bottom at a 4 1/2-month low on June 1. 
The short-term outlook is sideways to slightly bullish. The medium-term outlook is sideways and my model is long.
Initial resistance is at 1.5975. Further resistance is at 1.6085.
Immediate support is at 1.5845. The 200-day exponential moving average supports at 1.5743 and the 21-day exponential moving average at 1.5703. 

INDICATORS

Fast stochastics: Bullish
MACD: Slightly bullish
Ichimoku: Slightly bullish


OUTLOOK

NEAR-TERM: Sideways to slightly bullish  
MEDIUM-TERM: Sideways  
LONG-TERM: Sideways

 

CHF – September

Luca Model: Long since August 3  

The September Swiss franc remains firm at a 1 ½-month high after ending above the 55-day exponential moving average for two days. It had marked a one-month high on August 6. The franc bottomed at a 19-month low on July 24.
The short-term outlook is sideways to slightly bullish. The medium-term outlook is sideways and my model is long.
The 100-day exponential moving average resists at 1.0490. Further resistance is at 1.0590. 
The 55-day exponential moving average supports at 1.0360 and the 21-day exponential moving average at 1.0305.

INDICATORS

Fast stochastics: Bullish
MACD: Slightly bullish
Ichimoku: Slightly bullish


OUTLOOK

NEAR-TERM: Sideways to slightly bullish
MEDIUM-TERM: Sideways 
LONG-TERM: Bearish

 

CAD – September

Luca Model: Long since June 29

The September Canadian dollar is consolidating after closing off a 17-day low on Wednesday and falling from a four-month high on Tuesday. It’s been trading in a channel rising since late July. The loonie had peaked on April 27 and bottomed at a 5 1/2-month low on June 1. It should make a mild correction through the end of the week before the next move higher.
The short-term outlook is sideways. The medium-term outlook is bullish and my model is long.
Immediate resistance is at 1.0105. A pivot high is at 1.0168. Distant resistance is at 1.0275.
The 21-day exponential moving average supports at 1.0034. A pivot high is at 1.0155.


INDICATORS

Fast stochastics: Bearish   
MACD: Bearish
Ichimoku: Bullish


OUTLOOK

NEAR-TERM: Sideways   
MEDIUM-TERM: Bullish  
LONG-TERM: Sideways

 

AUD – September

Luca Model: Long since June 29

The September Australian dollar is edging up after reversing early losses on Wednesday.  It is still holding in an inside range. It is trading around the 21-day exponential moving average. The Aussie, which has been advancing since June 4, peaked at a new high for the uptrend on Thursday. 
The short-term outlook is sideways to slightly bullish. The medium-term outlook is bullish and my model is long.
The top of the uptrend is 1.0578. Further resistance is at 1.0700.
The 21-day exponential moving average supports at 1.0434. Further support is at 1.0350.

INDICATORS

Fast stochastics: Bullish 
MACD: Slightly bearish
Ichimoku: Sideways


OUTLOOK

NEAR-TERM: Sideways to slightly bullish   
MEDIUM-TERM: Bullish 
LONG-TERM: Sideways