GBP/USD....1.5196...Downtrend
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GBPUSD: 1.5196
Short-Term Trend: downtrend
Outlook:
The expected recovery did occur and GBP rallied to 1.5240 last week. Now, it seems the larger-degree downtrend has resumed, but to confirm we need a move below 1.5000. I expect this to hapen early this week. Below 1.5000 we can expect a downside acceleratio and quick losses twd 1.4560 level.
On the upside, only a move abv 1.5320/30 negates and risks larger recovery twd 1.5600 before the bears take control again...
Strategy: Holding short from1.5180 is favored. Stop=1.5330.
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The Dollar Index (DX) after trading sideways between 84.50 and 83.50
Market Commentary
Greenback traded strong against most of the FX majors on the event of profit taking witnessed in most of the asset classes especially in the benchmark equity index of Dow Jones Industrials (DJIA). The Dollar Index (DX) after trading sideways between 84.50 and 83.50 for couple of weeks closed below the support of 83.50 ranges to slip to interim support of 83.00 ranges; consistently trading below 83.50 would drag the index further to 82.45 ranges.
The benchmark equity index of the Dow Jones Industrials Average (DJIA) seems to be over stretched though the major trend is still intact till DJIA manages to trade above 14860 ranges. Historic correlation between DX Vs DJIA the long term trend is still Dollar bearish till the Dollar Index is not closing above 88.40 with 84.50 ranges acting as intermediate resistance.
| Sideways-Up |
1.3110 |
1.3060 |
1.2960 |
1.2940 |
| Sideways-Down |
102.20 |
101.20 |
99.80 |
99.50 |
| Sideways |
1.5280 |
1.5250 |
1.5150 |
1.5120 |
| Sideways-Down |
0.9660 |
1.5250 |
0.9500 |
0.9480 |
| Sideways |
132.80 |
131.40 |
129.90 |
127.50 |
| Sideways |
0.9730 |
0.9660 |
0.9575 |
0.9520 |
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EUR/CHF breaks key support level 1.242, set to fall to 1.2355 in 2 days
Scanning for chart patterns
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As can be seen from the following trade opportunity alert for EUR/CHF, the pair recently broke the 30-minute Key Support Level 1.242 identified by Autochartist. The price is set to reach the target level 1.2355 in 2 trading days.
The stop-level for this bearish forecast is set at 1.2517. The breakout of this support level continues the preceding downward price thrust from the major resistance level 1.2570 (A), which previously reversed the pair sharply down at the start of 2013 (as can be seen on the third chart below). The following Volatility Analysis confirms this bearish forecast.
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As is visible from the following Volatility Analysis chart for EUR/CHF, the lower boundary of the daily Expected Price Range calculated by Autochartist for this pair (1.2353) stands within 2 pip’s distance of the target level given in the above trade opportunity alert (1.2355) – which adds to the likelihood the price will soon fall to 1.2355.
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The daily EUR/CHF chart below demonstrates the earlier price action near the resistance level 1.2570:
http://mediaserver.fxstreet.com/Repo...0603051920.png
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USD/JPY in a Falling Wedge, Probing 100
USD/JPY 4H chart 9:07AM EDT 6/3/2013
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Correction structure: The USD/JPY has been in a correction since hitting the 103.72, 2013-high. The first correction wave came down to 100.66, and was in an abc manner. Then from the 102.55 pivot, another corrective wave pushed prices down to about 100.00 handle, which is holding so far in the 6/3 US session. You can see that the second wave down was in a falling wedge structure with price nearing the apex.
It’s not clear what the entire correction structure will be, but it appears to be also a larger wedge forming, though I think another hold of falling resistance will be needed to qualify as a wedge.
Below the 99.90 pivot, the next key support will be the rising trendline seen in the daily chart, going back to Nov. 2012 when the USD/JPY started to take off.
Momentum: The 4H RSI shows that the bullish momentum is still maintained, or at least that the recent bearish price action does not have bearish momentum in this time-frame.
The US NFP data scheduled for release this Friday will likely be the key event risk this week, and I like the chances the market will hold at or above the 99.90-100.00 area. On the other hand, the USD/JPY might have difficulty reaching back to the 2013-high ahead of the Friday even risk as well and the 102.55 local resistance pivot should be monitored as a limit to the upside risk until after we get the jobs data.
USD/JPY daily chart 6/3/2013
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GBP/USD: Double Bottom Target Reached; Resistance Factors Around 1.53
GBP/USD 4H chart 6/3/2013 6:55AM EDT
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Double bottom target: After completing a double bottom, GBP/USD continued higher, retreated from 38.2% retracement, and then respected the double bottom as a bottom. The double bottom breakout target using its width projects to just under 1.53. There was also a resistance pivot at 1.5280, and 50% retracement at 1.5306. The 1.5280-1.5306 area therefore should be monitored, and if there is no uptrend yet, we could see some resistance here.
Topping clues: When looking at the 1H chart, we see that price action has been bullish, and the RSI pushed above 70. Maybe, we should see if a bearish divergence can form. Then, it would be more reason to believe that this 1.52890-1.5306 area can provide resistance for a bearish swing at least in the very short-term. A break of a projected short-term TL should also improve likelihood of the pair falling back into the bottom area around 1.5010.
We have the BoE interest rate policy meeting on Thursday, so bullish or bearish anticipation should be limited to the intra-day basis.
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GBP/USD: Bullish above 1.5240
GBP/USD soared this Monday on better than expected UK Manufacturing PMI, reaching 1.5287 and holding onto its gains, despite local share markets can’t made it to the green. The dollar is mostly bearish across the board, although little action has been seen so far in other major crosses. The 4 hours chart shows price managed to break above 200 EMA which now offers dynamic support around 1.5250, while indicators head north in positive territory, with a strong upward momentum, and 20 SMA also gaining bullish slope. Overall, the pair will maintain the bullish tone as long as above 1.5240, former highs, with a break above 1.5290 signaling a short term continuation towards the 1.5330 price zone.Steady losses below 1.5240 will deny the possibility of an advance today, and probably see price retracing towards 1.5190 area.
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USDJPY Could Turn Bullish From 98.85-Elliott Wave
USDJPY extended its weakness yesterday towards 100.00 psychological level and even 99.00 that we have been focusing on in our past updates. Well, we anticipated a larger impulsive drop in black wave 3, but notice that pair is now reversing sharply from the lower side of a trading channel. This is usually the first sign that whole pull-back is corrective. With that in mind, its better to stay aside now and wait on possible break through the upper side of a trading channel that would put bullish waves back in play.
USDJPY 4h
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AUD/CHF 1H Chart Emerging Pattern: Channel Down
CAD/HKD 1H Chart
Emerging Pattern: Channel Up
After reaching a low of 7.4501 CAD/HKD commenced a rally, forming a channel up. At the moment, however, the currency pair undergoes a bearish correction that may result in a dip down to 7.4992 (200-hour SMA), as it has just encountered an upper boundary of the channel. According to traders’ sentiment, the market also expects softer loonie in the near future.
http://mediaserver.fxstreet.com/Repo...0604082146.jpg
CHF/SGD 1H Chart
Emerging Pattern: Channel Up
The Swiss Franc started to consistently outperform its counterpart from Singapore already in the mid-May, but the up-trend became more orderly 161 hours ago, being shaped by two parallel lines. While the technical indicators are unable to give a certain answer, there is a strong conviction among traders that CHF/SGD will continue to rise.
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AUD/CHF 1H Chart
Emerging Pattern: Channel Down
Recently the pace of Aussie’s debasement has increased, leading to the channel down pattern you may see above, since the price proved to be unable to breach the 200-hour SMA. Technical studies largely give ‘sell’ signals, reinforcing the belief that AUD/CHF will fail to overcome a key resistance at 0.9296/88. On the other hand, 62% of traders hold long positions.
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