Euro pushes closer to 1.3200 technical confluence. Dollar/Yen still well supported ahead of 50-Day SMA. Cable continues to chop around; remain sidelined. Dollar/Swiss buy recommendation issued at 1.1400.
|EUR/USD - A bullish outside day on Wednesday delays the current round of pullbacks with an interim low now in place at 1.2885. Look for some upside over the coming session back towards the 1.3200 area before considering the prospects of a fresh lower top and bearish resumption. Resistance by 1.3200 comes in the form of fib retracements and the 20/100-Day SMAs. Strategy: SIDELINED; AWAIT CLEARER SIGNAL. We had issued a sell recommendation at 1.3200 on Thursday but do not expect this level to be hit.|
|USD/JPY - Any setbacks are seen limited with the overall structure still favoring additional upside back towards the major 87.15 double bottom objective by 104.00 over the coming days. There is some decent internal range support in the 98.00 area, while the 50-Day SMA at 97.65 is seen supporting any additional declines. Back above 98.90 is however required to accelerate gains and signal a resumption of the up-move. Only a close below 97.65 will delay outlook. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.|
|GBP/USD - The market continues to chop around following the latest drop out from the 1.5070 mid-April highs. While the overall structure favors additional weakness over the medium-term, a break back below Wednesday's 1.4395 lows will now be required to trigger the next downside extension. In the interim, we expect any rallies to be well capped ahead of 1.4820, with only a break back above to delay outlook. Any strength on Thursday is still mitigated by the inside day price action with the market confined to Wednesday's range. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.|
|USD/CHF - The break back below 1.1635 on Wednesday has triggered the latest round of pullbacks with a move now seen back towards the 1.1400-1.1450 area over the coming session. However, we retain our bullish outlook and a fresh higher low is sought out by 1.1400-1.1450 ahead of the next upside extension back above 1.1740 and towards 1.1835-1.1900. Ultimately, only a close below the 200-Day SMA way down by 1.1335 would be required to shift the structure. Strategy: BUY @1.1400 FOR A 1.1740 OBJECTIVE, STOP 1.1280. |
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 email@example.com and you will be added to the distribution list.
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