• Euro setbacks seen extending towards 50-Day SMA
• Dollar/Yen consolidates above Ichimoku Cloud
• Cable remains well offered and eyes break below psychological barriers
• Dollar/Swiss locked in mid-range following impressive bounce from range lows
EUR/USD - Daily studies have rolled over and the market is in the process of correcting off of the 2009 highs set by 1.4450 in the previous week. The market has broken back below the 10 and 20-Day SMAs thus far and looks poised for deeper setbacks over the coming hours to challenge the 50-Day SMA and rising trend-line support by 1.4080. Any rallies are expected to be well capped ahead of 1.4300. STRATEGY: STAND ASIDE; LOOK TO SELL
USD/JPY - The bearish structure off of the 2009 highs is now in jeopardy of being compromised following Friday's impressive surge back above 97.00. The break and close above 97.00 is significant with the price settling above the daily Ichimoku cloud to warn of a potential shift in the structure. Nevertheless, we have seen false breaks above the cloud in the past and will only officially shift our outlook on a break above the medium-term 98.90 lower top. POSITION: SHORT @ 97.03 FOR OPEN OBJECTIVE; STOP 98.75.
GBP/USD - Continues to extend declines in the early week with the market most recently taking out the 1.6600 figure to eye psychological support by 1.6500. There is no real support however until the 50-Day SMA, which comes in by 1.6435. Below the 50-Day SMA then exposes 1.6340 further down. While the overall structure remains constructive, daily studies show room for additional corrective action and we recommend taking to the sidelines until a clearer opportunity presents. STRATEGY: STAND ASIDE; AWAIT CLEARER SIGNAL
USD/CHF - The market has failed to show any decent downside follow through after breaking to fresh 2009 lows by 1.0560 in the previous week. Instead, the familiar range base is more or less intact with the market bouncing back into the 1.0800's thus far to once again put the key 1.1025 range highs in sight. In the interim, we can not offer any directional bias with the market trading in the middle of a choppy range. STRATEGY: SIDELINED FOR NOW; AWAIT CLEARER SIGNAL
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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Daily Classical - A Daily Technical Overview of the Major Currencies.
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