AUD showing some early weakness
As I mentioned earlier, the AUD is looking weak today against most of the other majors. Intraday traders are obviously thinking the same and are setting themselves short, probably with stops above .9235. Most intraday positions will be reduced before the Stevens speech in 3 hours.
EUR/USD: 1.3300 option barrier rolled off overnight
Thanks to @FXWW888 for the inside rub that the well-defended 1.3300 option barrier rolled off overnight.
No change in the technical picture though, with well-trodden range edges at 1.2750/1.3400 and a moderately constructive short-term up-trend.
The crosses are a total mixed bag and aren't offering any strong indications one way or the other for the EUR. Best wait and see what the ECB has to say.
CAD/JPY and GBP/JPY: Talk of good-sized selling interest
Unfortunately I don't pay much attention to either pair and the levels at 95.35 and 150.00 respectively don't mean much to me. I believe there is some good-sized macro interest to sell both of these pairs on rallies (sorry no exact levels), and it might be a good idea to put both of these on your radars.
USD/JPY: Trying to form short-term base near 97.60
The market seems to be getting a bit bearish in the short-term on USD/JPY and it may be ripe for a bit of a squeeze? Overall I still prefer the sell-rally strategy but there is technical support at 97.60 (see chart) which has held firm on 3 separate occasions. There is certainly strong risk-reward case for buying dips to 97.70/75 with stops below 97.50, looking for a short-covering rally towards 99.00?
On the crosses, AUD/JPY is of course nearing strong technical support starting at 89.50 and EUR/JPY is also stalling near shorter-term Fibo levels (see chart). Both of these will give the bulls added reason to try picking a base in USD/JPY.
Medium-term bears should be patient and sit back and wait for some 'silly' spikes back towards 99.50.
AUD: Levels to watch in today's trade
- Should stay quiet with only a speech by RBA Governor Stevens to look forward to.
- Previous short term support in AUD/USD now acts as intraday resistance.
- Lows from last week at .9130 are the downside target.
- AUD/NZD support levels seen 1.1365/85.
- AUD/JPY sitting on important 90.00 level with big technical support below 89.50.
- EUR/AUD has again closed above 1.4400 which will give the bulls some momentum.
AUD/USD: Case for bottom pickers looking a bit shakier
I thought that the AUD/USD bottom-pickers were holding some pretty strong cards yesterday and the fact that it's been unable to maintain its gains is certainly worrying. I cut 1/2 my position on the break below .9215 and I have a trailing stop on the balance 100 pips lower. No point in being too stubborn!
AUD/JPY is sitting on support levels near 90.00 and that should give the AUD/USD some support this morning. On the other hand, NZD/USD has broken back below .8060 and is looking a little shakier as well.
GBP/CAD: Medium-term trade idea with good risk reward [The Carney Trade]
- Monthly chart shows how far this pair has fallen with little or no retracement (see chart).
- Weekly chart shows extended sideways consolidation inside wide 1.52/1.62 range (see chart).
- Daily chart shows that the long-Fibo of the 1.5440/1.6270 move held firm (see chart).
- 2-hour chart is trading sideways but is trying to form a platform trend-line from which to launch another move higher (see chart).
Play from the long side with a stop below 1.5720. If triggered, look for deeper dips to reinstate longs when short-term support forms, as long as medium-term range lows near 1.5200 continue to hold. Longer-term target at 1.8800.
Care is warranted on JPY and CHF crosses
We are witnessing some hefty positional liquidation across the so-called 'risk' pairs and I think those who've been trying to buy EUR/CHF or GBP/JPY or the like will need to be careful over the next few days. I'm not yet 100% sure that this move is USD-driven rather than risk-driven so I'd suggest that you exercise some extra care in these crosses. (Signed- Nervous Nellie :) ).
AUD/USD: Time to start using trailing stops
I'm not a great believe in the use of trailing stops (for the simple reason that they usually get triggered!) but I've been trying to build a long AUD/USD position for some weeks now and I feel that if we can't break above .9350 in the next few sessions then it's probably going to struggle to do so any-time soon. I've got trailing stops now below .9215 and below .9110 so even if it does collapse from here, at least it won't cost me anything.
AUD/USD: Topside pressure should increase as AUD/JPY nears 90.00
The JPY crosses are weak in the face of heavy positional liquidation and AUD/JPY is drifting towards the lower end of its consolidation channel 90.00/93.50. I don't think we are in a mass risk-off market so I'd expect support levels in the Yen crosses to be respected. That means that the AUD/USD should come under increasing topside pressure as the cross nears its support levels.
If you are tempted to sell near .9325/50 then keep stops tight but I for one am sticking with my long position.
USD/JPY: Technical support near 97.60 but selling rallies favoured
If you are a strong believer that this pair is in an up-trend then you can consider buying Fibo pull-backs to levels like 97.60 (50% 93.75/101.45) see chart. I am of the opinion that we are in an extremely choppy market phase and I think we are more likely to see lows near 94.50/95.00 before the market stabilises again. Resistance levels should be firm now on the approach to 99.00.
EUR/USD: Overall bullish but....
- The USD has started to lose its shine and the market is trimming longs at the moment.
- EUR/AUD looks overbought on medium-term outlook. Has been struggling to confirm above 1.4400 and we could see a pull-back toward more neutral levels near 1.40.
- EUR/JPY has come a long way in the last few months and although the outlook remains moderately bullish, we could easily see a pull-back towards 127/128 without altering the bullish outlook.
- EUR/GBP looks mildly bullish whilst above .8550 but EUR/CHF is struggling to maintain gains and is starting to look a bit heavy.
- EUR/USD short-term technicals show consolidation between 1.3250/1.3300 whilst the longer term picture shows sideways range trading roughly between 1.2750/1.3400.
Looks to me as if we get further sideways movements, just a matter of picking the ranges as always. I prefer the buy-big-dip strategy but selling intraday rallies towards 1.34 also has its attractions.
AUD/USD: Still prefer to buy dips for break above .9350
- As with USD/JPY, I expect positional adjustment to be main factor in the AUD/USD.
- AUD/JPY is still range-bound between 90.00/93.50 (see chart) and we should see AUD demand increase as we near the lower end.
- EUR/AUD has again failed to convincingly close above its technical pivot at 1.4400 and I think we may get some extended 1.39/1.45 consolidation.
- The short-term charts are looking moderately constructive and the market is trying to form support near .9230 (see chart).
- The AUD didn't really react to the sharp fall in the copper price. There isn't a super-strong correlation here but nonetheless, the lack of any reaction does suggest that the bears are getting tired.
There is nothing of note on the economic calendar today so we will depend on flows. I prefer to buy intraday dips towards short-term support at .9230 looking for a test of .9330/40 resistance later today. A break back below .9200 will muddy the picture and put short-term bears back in control.
USD/JPY: Plenty of volatility, perfect for the day-traders
- Position unwinding ahead of August holiday period is main factor at play here.
- Latest data shows Yen shorts had again been increasing sharply and we saw a sharp unwind on Friday.
- The USD remains under pressure ahead of an important data week and more FOMC.
- Yen crosses look mixed and volatile consolidation is favoured rather than any big trend moves.
- Fairly quiet start in early interbank trade saw a quick push to test levels below 98.00.
The Yen looks oversold and with the market short and probably looking to cover before holidays begin, I still favour the short-side in USD/JPY. But, its already fallen sharply so you need to pick your levels very carefully. Of all the major pairs, this is the one that seems most suited to the day-traders.
AUD/USD: Looking to book interim profits near .9330
It's Friday after all, so unless AUD/USD takes off vertically in the next few hours I will look to take 1/2 my position off near .9330 and sleep easy over the weekend. Not hearing the same reports regarding big sellers .9325/40 that were everywhere earlier in the week (but the macro-fund call levels are still there above .9350).
NZD/USD: Strong technical resistance near .8180
If you're a die-hard USD bull then maybe NZD/USD might give you some joy. The close above .8060 was undoubtedly short-term bullish but there is very healthy resistance in the form of a trend-line and a 50% retracement at .8180 (see chart). Of course the trend-line/61.8% is one of my favourite signals but this one is usually fairly useful as well.
AUD/NZD has been on a rip-roaring bear move but you would be very brave to bet against some sort of a retracement back towards 1.1600 and this may also give the NZD/USD a bit of downward pressure.
As you know, buying USD ain't my side at the moment but it takes all sorts to make a market :)
USD/JPY seeing plenty of pre-weekend long-liquidation
Overnight lows at 98.90 have been breached and the next main level of technical support is at 98.25. The sharp sell-off reaction in late NY trade to the WSJ piece obviously inferred that the market is long and uncomfortable, and that status still hasn't been undone judging by today's price action.
Selling short-term rallies still favoured here.
AUD/USD: Looking pretty solid mid-way through Asian session
AUD/USD rallied in a straight line form .9150 to .9275 much earlier this morning and the pull-back was limited to around 40 pips. Now we are back near the overnight highs and this pair is headed higher. We should see a test of .9330/50 later on tonight and whilst the first test may hold yet again, I wouldn't be so sure this time.
The AUD is also looking friendlier on the crosses and with USD/JPY trading with a heavy tone, most indicators are pointing up.