The appetite for risk remains firm, if little changed from Tuesday, ahead of a ruling from Germany's highest court on whether the Eurozone's bailout fund can legally go ahead and before a policy review by the Federal Reserve ending on Thursday. German politicians will play ball. The foreign currencies are firm after advancing across the board after on Tuesday. This strength should persist today as well. The Asian stock markets advanced.

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

Good luck!

 

Overnight

  • Japan: An index measuring the prices of domestic corporate goods rose 0.3% in August following the downwardly revised contraction of 0.5% in July. 
  • Japan: Core machine orders rose 4.6% in July following the 5.6% jump in June. 
  • Japan: The tertiary industry index was down 0.8% in July following the upwardly revised 0.2% increase in June.
  • Australia: Westpac consumer confidence index rose 1.6% in September after falling 2.5% in August.

  

Today's economic calendar

  • Eurozone: Industrial production for July 
  • Germany: CPI for October 
  • France: Consumer Price Index final  for August 
  • France: Current account for July 
  • Italy: Industrial output for July 
  • UK: ILO unemployment rate for September 

 

EUR – December

Luca Model: Long since August 3        
 
The overbought December remains strong after soaring to a four-month high on Tuesday and should march higher today as well. It is overbought. The euro is trading above the 100-day exponential moving average. The euro had bottomed an over two-year low in late July and remains in a rising channel.
The short-term outlook is sideways. The medium-term outlook is bullish and my model is long.
Initial resistance is at 1.2930. Further resistance is at 1.2977.
Immediate support is at 1.2755. The next floor is 1.2670. The 21-day exponential moving average supports at a distant 1.2607. 


INDICATORS

Fast stochastics: Bullish
MACD: Bullish
Ichimoku: Bullish


OUTLOOK

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

 

JPY – December

Luca Model: Long since August 22             
 
The December Japanese yen remains firm after surging to a five-week high and blasting the top of a symmetrical triangle on Tuesday. It is trading above the 21-day exponential moving average. The yen had bottomed at a five-week low on August 17. 
The short-term outlook is sideways. The medium-term outlook is sideways and my model is long.
Immediate resistance is at 1.2870. A pivot high is at 1.2920.
The 21-day exponentially smoothed moving average supports at 1.2759 and the 100-day exponential moving average at 1.2684. The next resistance levels are 1.2800 and 1.2854.

INDICATORS

Fast stochastics: Bullish
MACD: Bullish
Ichimoku: Sideways


OUTLOOK

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

 

GBP – December

Luca Model: Long since July 19                  

The overbought December pound remains firm after hitting a four-month high on Tuesday. 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. The medium-term outlook is bullish and my model is long.
Initial resistance is at 1.6130. A pivot high is at 1.6276.
Immediate support is at 1.6025. The next floor is 1.5905. The 21-day exponential moving average supports at a distant 1.5866. 

INDICATORS

Fast stochastics: Bullish
MACD: Bullish
Ichimoku: Bullish


OUTLOOK

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

 

CHF – December

Luca Model: Long since August 3  

The December Swiss franc is quiet after printing a three-month high on Tuesday. The franc is trading above the 100-day exponential moving average. It had marked a near two-month high on August 31 and bottomed at a 19-month low on July 24. The franc has been trading a rising channel since then.
The short-term outlook is sideways. The medium-term outlook is bullish and my model is long.
Initial resistance is at 1.0685. The 200-day exponentially smoothed moving average resists at 1.0755.
Immediate support is at 1.0600. The next floor is 1.0525. The 21-day exponential moving average follows at a distant 1.0483. 

INDICATORS

Fast stochastics: Bullish
MACD: Bullish
Ichimoku: Bullish


OUTLOOK

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

 

CAD – December

Luca Model: Long since June 29

The overbought December Canadian dollar is consolidating after advanced to a new high for the uptrend on Tuesday. The Canadian dollar has been trading in a channel rising since late July. It bottomed at a 5 1/2-month low on June 1. 
The short-term outlook is sideways. The medium-term outlook is bullish and my model is long.
Immediate resistance is at 1.0305. Further resistance is at 1.0400.
Initial support is at 1.0230. The next floor is 1.0170. The 21-day exponential moving average supports at a distant 1.1015. 


INDICATORS

Fast stochastics: Bullish
MACD: Slightly bullish
Ichimoku: Bullish


OUTLOOK

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

 

AUD – December

Luca Model: Long since September 7

The December Australian dollar is trading above the 21-day exponential moving average after rallying on Tuesday. The Aussie, which has been advancing since June 4, peaked at a new high for the uptrend on August 9. 
The short-term outlook is sideways. The medium-term outlook is slightly bullish and my model went long.
Immediate resistance is at 1.0430. Further resistance is at 1.0525.   
The 21-day exponential moving average supports at 1.0280. A further floor is at 1.0235. A pivot low is at 1.0077.

INDICATORS

Fast stochastics: Bullish 
MACD: Slightly bullish
Ichimoku: Sideways


OUTLOOK

NEAR-TERM: Sideways       
MEDIUM-TERM: Slightly bullish   
LONG-TERM: Sideways