Euro reaches key inflection point. Dollar/Yen gains seen limited above 100.00. Cable confined to range despite recent surge. Dollar/Swiss still focused on 200-Day SMA. Dollar/Cad dips below 1.1800 viewed as compelling buy opportunity. Australian Dollar to fresh 2009 highs but stalling. New Zealand Dollar attempting to carve h&s top.
EUR/USD
[B]EUR/USD – [/B]The break above falling channel support off of the 1.3740 highs is concerning for bears but the market has failed to show any good follow through thus far. After breaking out on Wednesday, gains extended to 1.3390 Thursday before pulling back into the 1.3200’s. This could now set up the potential for a false upside break and once again put pressure on the downside. However, we recommend taking to the sidelines at current levels, with a break back above 1.3390 or below 1.3195 required for clearer directional bias. Above 1.3390 exposes 1.3585-1.3740 while below 1.3195 opens a move back to 1.3000.[B] Strategy: SIDELINED; AWAIT CLEARER SIGNAL.[/B] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
1.3515
[B]R3[/B]
4/2 high
1.3390
R2
4/30 high
1.3340
R1
4/29 high
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
1.3195
S1
4/30 low
1.3120
S2
4/29 low
1.3000
[B]S3[/B]
4/27 low
[B]
USD/JPY[/B]
[B]USD/JPY – [/B]Continues its impressive rally from the Ichimoku cloud top and is in the process of retracing the latest 101.45-95.60 move. The market has broken back above the 61.8% retrace and now eyes a break back above 100.00. Key levels to watch over the coming sessions come in by 100.00 and 98.50 respectively. A break above 100.00 will open a move back to the 101.45, 2009 highs, while back under 98.50 sets ups a bearish reversal targeting 95.60. [B]Strategy: SELL @100.20 FOR A 97.15 OBJECTIVE, STOP @101.65. [/B][I]Stops to be trailed to cost on a break back below 99.80. If trade triggers and 99.80 not broken, position to be closed out at NY close (4pm NY time) on Friday. Recommendation to be removed if not triggered by NY close on Friday. [/I] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
100.45
[B]R3[/B]
4/14 high
100.00
R2
Psychological
99.75
R1
4/17 high
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
98.50
S1
5/1 low
97.95
S2
4/29 high
97.15
[B]S3[/B]
4/30 low
GBP/USD
[B]GBP/USD – [/B]No reason to be taking positions at current levels with the market caught in the middle of a very choppy range. Our bias however is for an eventual resumption of the broader downtrend to be confirmed on a break back below 1.4395 which should then open a fresh downside extension exposing next key support by 1.4110 (30Mar low). Any rallies should be well capped ahead of 1.5000 with only a sustained break back above 1.5070 required to shift outlook. [B]Strategy: SIDELINED; AWAIT CLEARER SIGNAL.[/B] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
1.5070
[B]R3[/B]
4/16 high
1.5000
R2
Psychological
1.4950
R1
4/30 high
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
1.4755
S1
5/1 low
1.4705
S2
4/30 low
1.4610
[B]S3[/B]
4/29 low
USD/CHF
[B]USD/CHF – [/B]The 200-Day SMA is the key here with the market remaining quite constructive while the pair holds above the longer-term moving average on a close basis. Recent attempts below the moving average have failed and we are once again bouncing to suggest fresh upside. Look for a break back above 1.1445 to take pressure off of the downside and accelerate gains towards 1.1600. A close below the 200-Day SMA at 1.1370 will be bearish and open a direct test of the 1.1165 19Mar lows. [B]Strategy: SIDELINED; AWAIT CLEARER SIGNAL.[/B] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
1.1600
R3
4/22 low
1.1530
R2
4/24 high
1.1455
R1
4/17 low
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
1.1345
S1
200-Day SMA
1.1305
S2
4/13 low
1.1240
S3
4/6 low
USD/CAD
[B]USD/CAD – [/B]Has pulled back quite sharply over the past several days with the market breaking to fresh multi-day lows below 1.1980 to finally break the 200-Day SMA by 1.1850. While the current pullback changes the picture somewhat, the broader structure still remains constructive with the market locked in a longer-term bullish consolidation dating back to October of 2008. As such, any dips towards the bottom of the range should be used as opportunities to establish long positions in anticipation of a move back into the mid-range at a minimum. [B]Strategy: BUY @1.1780 FOR A 1.2270 OBJECTIVE, STOP @1.1630. [/B][I]Stops to be trailed to cost on a break back above 1.1830. Recommendation to be removed if not triggered by NY close on Friday. [/I] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
1.2075
[B]R3[/B]
4/24 low
1.2050
R2
4/30 high
1.1955
R1
5/1 high
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
1.1800
S1
Figure
1.1765
S2
1/6 2009 low
1.1655
[B]S3[/B]
11/10 low
AUD/USD
[B]AUD/USD – [/B]The market continues to chop around within a very broad 0.6000-0.7400 range dating back to October 2008. Despite the recent strength and break to fresh 2009 highs, the overall structure remains grossly bearish and given the proximity to the range highs, we like the idea of looking for opportunities to be short in anticipation of retest of the range lows at minimum. A break back below 0.7000 should help to accelerate declines and confirm bearish resumption.[B] Strategy: SIDELINED; AWAIT CLEARER SIGNAL.[/B] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
0.7400
[B]R3[/B]
Figure
0.7385
[B]R2[/B]
4/30 2009 high
0.7350
R1
5/1 high
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
0.7230
S1
4/30 low
0.7160
S2
4/23 high
0.7050
[B]S3[/B]
4/29 low
NZD/USD
[B]
NZD/USD – [/B]The market continues to consolidate the latest setbacks off of the 0.5985 April highs with the daily chart potentially attempting to carve out a head & shoulders-like topping formation. A break below neckline support in the 0.5500 area would be required to confirm and accelerate declines back down to a measured move objective by 0.5000. However, at current levels, no positions are recommended with the market just as easily seen rallying back to the 0.6035 2009 highs from January. [B]Strategy: SIDELINED; AWAIT CLEARER SIGNAL.[/B] [B]Level[/B]
[B]Resistance[/B]
[B]Details[/B]
0.5985
[B]R3[/B]
4/6 high
0.5825
R2
4/16 high
0.5780
R1
4/29 high
[B]Level[/B]
[B]Support[/B]
[B]Details[/B]
0.5570
S1
4/29 low
0.5530
S2
4/28 low
0.5485
[B]S3[/B]
4/20 low
[B]
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com. If you wish to receive Joel’s reports in a more timely fashion, e-mail[/B] [email protected] and you will be added to the “distribution” list.
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