The following are the intraday outlooks for EUR/USD, USD/JPY, and USD/CAD as provided by the technical strategy team at SEB Group.
EUR/USD: One more dip, then a rebound. Yesterday’s decline became even more powerful than expected passing the 1.1190/1.1200 weekly swing area. We are now approaching firmer support (the preceding downside reaction lows) in the 1.1067 area. The hourly graph reveals a pattern that calls for the market to make one more low (in this sequence) before rebounding back to the mid 1.11’s.
USD/JPY: (WEEKLY GRAPH) Making a go to the topside. The break above 120.28 got the buyers attention and the pair has thereafter rallied strongly also breaking above the April top, 120.85. What makes the situation even more interesting is the fact that during the consolidation since last autumn the market (here measured by the CoT statistics) has cut its short yen position to basically zero (but recent weeks cautiously starting to rebuild it). So a break higher will definitely be underpinned by a market that isn’t positioned for it.
USD/CAD: Triple bottom confirmed. The break and close above 1.2205 has now confirmed the triple bottom hence having paved the way for more upside potential. There might be a small pause around 1.2230 (a 161.8% Fibo projection point) to catch the breath ahead of the next move higher.
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