AUDUSD: Lower close after spike signaling negative tone
|Daily Forecast - 19 May 2017
AUDUSD Spot
AUDUSD edged to 7466 but not as far as quite strong resistance at 7485/90. The spike higher followed by a lower close should signal a more negative tone for today. Holding below first resistance at 7420/30 targets 7390/85 & 7345/40 before a retest of 7330/26 lows. A break lower in to next week targets strong 16 month trend line support at 7300/7295. Try longs with stops below 7250.
Gains are likely to be limited but first resistance at 7420/30 targets 7460/65 before quite strong resistance at 7485/90. Try shorts with stops above 7540. An unexpected break above here however is a buy signal targeting 7595/99.
EURUSD Spot
EURUSD minor resistance at 1.1120. We should exit longs on the approach after yesterday's negative candle in overbought conditions. This increases profit taking risks in to the end of the week. Holding below 1.1120 followed by a dip below 1.1080 signals further losses to 1.1045 & perhaps as far as strong support at 1.0990/80. Try longs with stops below 1.0955.
Above 1.1130 allows a further recovery towards the 1.1165/70 high but strong resistance at 1.1200/10 is the one to watch. Exit longs & try shorts with stops above 1.1250. Bulls require a weekly close tonight above 1.1230 for a longer term buy signal now.
GBPUSD Spot
GBPUSD collapsed sharply to 1.2889. Bulls could not hold above the psychological 1.3000 level. A break below 1.2889 today risks a slide to the low this week at 1.2864 then the low last week at 1.2842 & probably as far as the May low at 1.2829. Try longs at 1.2830/20 with stops below 1.2790.
Holding above 1.2920 re-targets 1.2965/60 & 1.2985/90 before the 1.3045/47 high. If we continue higher look for 1.3055/60 & 1.3085/90.
USDJPY Spot
USDJPY has minor support at 111.25/20 & holding here allows a further recovery to 111.80/90. This should be a challenge when combined with 4.5 month trend line resistance at 112.20/30. There is a good chance this area will mark a high for the day but shorts need stops above 112.60. A weekly close above 112.30 could be seen as more positive for the start next week.
Failure to hold above 111.10 keeps bears in control targeting 110.75/70 & support at 110.55/50. A break below 110.20 then targets 109.90 & important 200 day moving average & 6 month trend line support at 109.70/60. This is the best chance of a low for the day. We also have a gap to fill at 109.48 so longs need stops below 109.30.
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