• Euro sell issued @1.4725
• Dollar/Yen stops to cost
• Cable carving right shoulder
• Dollar/Swiss fresh 2009 low
[B]EUR/USD[/B] – With the daily RSI by 70 and the market looking stretched, we do not anticipate the current rally to extend much further before a healthy and necessary corrective pullback. Key resistance comes in by 1.4720 which represents the December 2008 spike highs and we look for a rally towards this level on Tuesday, with the market potentially just exceeding 1.4720, before the start of anticipated correction. [B]STRATEGY: SELL @1.4725 FOR AN OPEN OBJECTIVE; STOP 1.4925. RECOMMENDATION TO BE REMOVED IF NOT TRIGGERED BY NY CLOSE (5PM) ON TUESDAY.
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[B]USD/JPY[/B] – We established a long position on Friday and have most recently moved our stops up to cost with overall price action quite choppy. However, our bias from here is for a more significant corrective bounce, with the daily studies looking to cross up from oversold after the market stalled on Friday by the 78.6% fib retracement off of the 2009 low-high. Monday’s bullish hammer-like close has been followed up with some positive momentum on Tuesday and a push back towards 92.00 is seen at a minimum before even considering bearish trend resumption. [B]POSITION: LONG @90.90 FOR AN OPEN OBJECTIVE; REVISED STOP @90.90.
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[B]GBP/USD[/B] – We continue to maintain a sell on rallies approach to this market with the view that the pair has made a meaningful high above 1.7000 this year. The ensuing price action is more choppy consolidation than any threat of a fresh upside extension beyond 1.7000. Arguably, the market could even be in the process of carving the right shoulder of a head & shoulders top that ultimately would project setbacks to 1.5000 over the coming weeks. Friday’s 1.6745 high is expected to cap any additional intraday rallies, while back under 1.6520 should accelerate declines. Only a close above 1.6745 would give reason for concern. [B]STRATEGY: STAND ASIDE FOR NOW; LOOK TO SELL RALLIES
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[B]USD/CHF[/B] – The market is looking extremely attractive to us at current levels with daily studies oversold and with no real reason to continue weakening after medium-term support at 1.0370 was finally taken out. A fresh 2009 low has been set on Tuesday at 1.0320 and we look for the latest bounce to open a break above 1.0425 on Tuesday to confirm bias and accelerate gains back into the 1.0500-1.700 area.[B] STRATEGY: STAND ASIDE FOR NOW; LOOK TO BUY DIPS[/B]
[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][B][email protected][/B] [B]and you will be added to the [/B][B]“distribution” [/B][B]list.[/B][B][/B]
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