Euro reverses sharply to negate Friday price action. Dollar/Yen finally takes out critical neckline; subject to pullback. Cable fails to establish momentum above 50-Day SMA. Dollar/Swiss right back to middle of range. Dollar/Cad still not ready to breakout. Australian Dollar gives back early gains. New Zealand Dollar consolidates over trend lows.
Any follow through from the bullish momentum seen at the end of the previous week has faded with the market extending just shy of psychological barriers at 1.3000 today before reversing sharply back under 1.2800. The pair remains confined to the underlying bear trend and a fresh lower top by 1.2995 is now sought out ahead of the next drop back below 1.2515. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.
The market has finally broken back above the critical 94.60 neckline resistance (6Jan high) to fresh 2009 highs on Monday. This now triggers a major double bottom pattern which ultimately projects upside back above 100.00 and into the 104.00 area. However, daily studies are looking stretched and the risks from here are for more of a pullback before fresh renewed momentum. Position: SHORT @94.70 FOR A 92.55 OBJECTIVE, STOP @95.70.
Positive momentum from Friday has carried over into Monday with gains extending to 1.4665 ahead of the latest minor setbacks. The market however, remains confined to a prominent bear channel with the price now stuck in the middle of the range. Rallies should continue to be used as sell opportunities and with the price once again unable to establish above the 50-Day SMA, a fresh drop could be on the verge of materializing. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.
Remains locked in a violent multi-day sideways chop with price action confined to the 1.1315-1.1890 area. Friday's extremely bearish reversal day has shown limited follow through on Monday with the market bouncing back into the mid-range. The overall structure however remains bullish and we expect dips to continue to be well supported ahead of an eventual break to challenge the key 2008 highs at 1.2300. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.
We have seen an ongoing contraction in volatility to the point where we have reached the apex of a very prominent triangle that has defined trade since late October. Falling triangle resistance comes in at 1.2660 and we will be looking for a daily close above the latter to confirm a breakout which will trigger a fresh upside extension exposing a direct retest of the 1.3020 October 28 trend highs. Ultimately, the upside break should project gains back towards 1.4005 (2004 Highs) over the coming months (measured move objective based off of widest point of triangle). However, the latest topside failure last Tuesday keeps the triangle intact and could open yet another retest on the triangle bottom in the 1.2000 area. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.
The latest round of setbacks have been well supported on dips ahead of 0.6300 and the market has since rebounded to potentially reintroduce the prospects for basing. It now appears that we remain confined to the broader multi-day sideways consolidation that has defined trade since October 2008 which leaves us with a neutral bias at current levels. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.
Friday's bullish close has done little to generate any fresh bids on Monday with the market seemingly content on consolidating just over the 0.4960 (2Feb low) trend lows. The overall structure remains grossly bearish and a retest of the latter is favored over the coming days with an acceleration expected on a break towards 0.4500 by the August 2002 lows. However, with daily studies closer to oversold, selling at current levels is not compelling and we remain comfortably sidelined. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.
Investment in the currency exchange is highly speculative and should only be done with risk capital. Prices rise and fall and past performance is no assurance of future performance. This website is an information site only. Accordingly we make no warranties or guarantees in respect of the content. The publications herein do not take into account the investment objectives, financial situation or particular needs of any particular person. Investors should obtain individual financial advice based on their own particular circumstances before making an investment decision on the basis of the recommendations in this website. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. All intellectual property rights are the property of Daily FX. Daily FX and its affiliates, will not be held responsible for the reliability or accuracy of the information available on this site. The content herein is provided in good faith and believed to be accurate, however, there are no explicit or implicit warranties of accuracy or timeliness made by Daily FX or its affiliates. The reader agrees not to hold Daily FX or any of its affiliates liable for decisions that are based on information from this website. Daily FX highly recommends that before making a decision, the reader collects several opinions related to the decision and verifies facts from at least several independent sources.