A better rebound effort than anticipated Wednesday, but despite a nudge at retrace resistance at 1.5725, the better barrier at 1.5735 peak has capped.

This leaves bearish pressures intact for a roll lower to the range, given the push last week through chart/ 61.8% retrace support 1.5750/20 and the early November breakdown through the 1.5854 weekly swing low from Q4 2013.

The November risk is still lower to a key swing low at 1.5430; interim targets are at 1.5593 and 1.5503/00.

Overshoot threat for November is to the 78.6% retrace support at 1.5320.

What Changes This? Above 1.5737 eases bear risks; through 1.5945 signals a neutral tone, only shifting positive above 1.6040.

For Today: We see a downside bias through 1.5646 for 1.5590; break here aims for 1.5572, maybe 1.5550. But above 1.5737 opens risk up to 1.5782.

 

2 Hour GBPUSD Chart

 

Weekly GBPUSD Chart

 

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A better rebound effort than anticipated Wednesday, but despite a nudge at retrace resistance at 1.5725, the better barrier at 1.5735 peak has capped.

This leaves bearish pressures intact for a roll lower to the range, given the push last week through chart/ 61.8% retrace support 1.5750/20 and the early November breakdown through the 1.5854 weekly swing low from Q4 2013.

The November risk is still lower to a key swing low at 1.5430; interim targets are at 1.5593 and 1.5503/00.

Overshoot threat for November is to the 78.6% retrace support at 1.5320.

What Changes This? Above 1.5737 eases bear risks; through 1.5945 signals a neutral tone, only shifting positive above 1.6040.

For Today: We see a downside bias through 1.5646 for 1.5590; break here aims for 1.5572, maybe 1.5550. But above 1.5737 opens risk up to 1.5782.

 

2 Hour GBPUSD Chart

 

Weekly GBPUSD Chart

 

continue reading »

A high level consolidation Tuesday, just below the Monday new recovery high.

The Monday push through 117.00 reinforced the rebound from support at 114.89 last week (ahead of a firm foundation at 113.85).

In addition, the Monday dip held above the 115.31 prop to maintain upside pressures this week and we see bullish extension threat for our next upside Fibo target at 117.45

Above here targets a key 2007 monthly high, 117.95 and for Q4 maybe even the long term retrace target at 120.10 just above a key option/ psychological barrier at 120.00.

Momentum: The 8-day RSI, short-term momentum is positive, but OB, but still has scope to go higher this week.

What Changes This? Below 115.95 eases bull risks; through 115.31 signals a neutral tone, only shifting negative below 114.89. 

For Today: We see an upside bias for 117.06; break here aims for 117.45. But below 116.34 opens risk down to 116.05 and maybe 115.47.

 

2 Hour USDJPY Chart

 

Monthly USDJPY Chart

 

 

 

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A high level consolidation Tuesday, just below the Monday new recovery high.

The Monday push through 117.00 reinforced the rebound from support at 114.89 last week (ahead of a firm foundation at 113.85).

In addition, the Monday dip held above the 115.31 prop to maintain upside pressures this week and we see bullish extension threat for our next upside Fibo target at 117.45

Above here targets a key 2007 monthly high, 117.95 and for Q4 maybe even the long term retrace target at 120.10 just above a key option/ psychological barrier at 120.00.

Momentum: The 8-day RSI, short-term momentum is positive, but OB, but still has scope to go higher this week.

What Changes This? Below 115.95 eases bull risks; through 115.31 signals a neutral tone, only shifting negative below 114.89. 

For Today: We see an upside bias for 117.06; break here aims for 117.45. But below 116.34 opens risk down to 116.05 and maybe 115.47.

 

2 Hour USDJPY Chart

 

Monthly USDJPY Chart

 

 

 

continue reading »

USDCAD bull trend looking to re-energize

  • We have stated in recent reports to our clients that “we continue to see better support on a dip to 1.1266/62” and “whilst above here, we see bias for a bounce to the setback range late this week, for 1.1403 and maybe 1.1450”.
  • The push close to 1.1403 leaves risk through here today and through mid-month we see upside risk above here and the recent cycle peak at 1.1468 to a Fibo extension level at 1.1495/ psychological 1.1500.
  • November overshoot threat is to 1.1655, the 61.8% retrace of the entire 2009-2011 bear market.

WHAT CHANGES THIS?

  • Below 1.1262 signals a neutral tone, only shifting negative below 1.1160.

Download our full report with latest screencast & levels here: http://members.marketchartist.com/Daily/USDCAD.pdf

4 Hour USDCAD Chart

 

Weekly USDCAD Chart

 

continue reading »

USDCAD bull trend looking to re-energize

  • We have stated in recent reports to our clients that “we continue to see better support on a dip to 1.1266/62” and “whilst above here, we see bias for a bounce to the setback range late this week, for 1.1403 and maybe 1.1450”.
  • The push close to 1.1403 leaves risk through here today and through mid-month we see upside risk above here and the recent cycle peak at 1.1468 to a Fibo extension level at 1.1495/ psychological 1.1500.
  • November overshoot threat is to 1.1655, the 61.8% retrace of the entire 2009-2011 bear market.

WHAT CHANGES THIS?

  • Below 1.1262 signals a neutral tone, only shifting negative below 1.1160.

Download our full report with latest screencast & levels here: http://members.marketchartist.com/Daily/USDCAD.pdf

4 Hour USDCAD Chart

 

Weekly USDCAD Chart

 

continue reading »

GBPUSD bear trend re-energizing

  • We saw skewed risk through midweek for a failure ahead of 1.6040 to leave a bear bias and the plunge to a new cycle low reinforces our ongoing bear view.
  • The breakdown last week through the 1.5854 weekly swing low from Q4 2013, leaves  mid-month risk lower
  • We still see bear threat for chart/ 61.8% retrace support 1.5750/20.
  • The risk through mid-month is now to 1.5430; interim targets are at 1.5616 and 1.5503/00.
  • Overshoot threat for November is to the August 2013 weekly swing low at 1.5430.

WHAT CHANGES THIS?

  • Above 1.6040 eases bear risks to neutral, only shifting positive above 1.6186.

Download our full report with latest screencast & levels here: http://members.marketchartist.com/Daily/GBPUSD.pdf

Daily GBPUSD Chart

 

Weekly GBPUSD Chart

continue reading »

GBPUSD bear trend re-energizing

  • We saw skewed risk through midweek for a failure ahead of 1.6040 to leave a bear bias and the plunge to a new cycle low reinforces our ongoing bear view.
  • The breakdown last week through the 1.5854 weekly swing low from Q4 2013, leaves  mid-month risk lower
  • We still see bear threat for chart/ 61.8% retrace support 1.5750/20.
  • The risk through mid-month is now to 1.5430; interim targets are at 1.5616 and 1.5503/00.
  • Overshoot threat for November is to the August 2013 weekly swing low at 1.5430.

WHAT CHANGES THIS?

  • Above 1.6040 eases bear risks to neutral, only shifting positive above 1.6186.

Download our full report with latest screencast & levels here: http://members.marketchartist.com/Daily/GBPUSD.pdf

Daily GBPUSD Chart

 

Weekly GBPUSD Chart

continue reading »

In business circles, Europeans have often characterized their region of the world as a fickle maiden with many suitors, never quite sure which one to pick and quite clever in never revealing her true intentions. This same characterization can easily be applied to the Euro, as well. Foreign exchange reserve managers and investors have chased after the fickle “EUR/USD” currency pair, thereby buoying its confidence, but the constant attention rarely meets with a satisfactory conclusion. The Euro continues to bounce from one direction to the next, never revealing its true intentions.

Occasionally, however, a fork appears in the road, an obstacle that cannot be ignored and must be addressed. Such a situation exists at present. The Euro is stuck, a technical term that defies definition. Analysts are betwixt and between when it comes to the next moves in the market, but that does not deter them from making bold forecasts for both the near and long-term horizons. If you are looking for convergence in their linear thinking, you will not find it.

The following chart illustrates the current confusion that exists for what’s next:

 

Depending on which analysis you read, the Euro is either progressing in a tight range or ascending a new recovery channel. Each path is designated with dotted-green lines on the 4-Hour chart for the “EUR/USD” pair. The portion of the market that believes that the Euro is ranging is quick to point out that the abundance of short positions almost dictates another leg down. The ECB’s latest attempt at QE will certainly dilute the Euro, putting more downward pressure on it during this brief period of consolidation.

Those on the opposite side of the fence point to the technical data. The Stochastics are rising, and volatility has generally picked up before a rush to higher levels, an old maxim in the trading community. The Euro has broken through resistance at 1.2470 and managed to peak above the repressive Kumo Cloud, if only to be blocked momentarily by the 100-4Hr EMA. For these optimists, history is in their favor, since forex reserve managers and investors have a lot riding on the value of the common currency.

The market power of this group has consistently come to the Euro’s rescue in the past, but 2014 has witnessed increased hesitation on this front, perhaps due to the persistence of unaddressed structural reforms and the lack of positive economic data for the region. Traders that followed a shorting strategy, however, have been burned before, but they may now finally have a real opportunity to recover their prior losses.

What are major banks forecasting for the Euro? BNP Paribas and UBS have updated their forecasts, based on the current situation. Both teams are more concerned about the obvious divergence of U.S. monetary policy and the rest of the world. If 2014 was to be the “Year of the Dollar”, then 2015 and 2016 will both be more of the same. BNPP does not buy into the channel theory. They continue to hold their short position with an ongoing target of 1.18.

UBS takes a more optimistic stance, setting 1.23, 1.25, and 1.20 for their predictions for one-month, 30-days, and 2015, respectively. Their explanation reads as follows, “We concur with the consensus view that the dollar will enjoy healthy gains in 2015 and beyond, but the path is potentially dynamic given that dollar strength could yield both benign and disruptive outcomes, depending on what’s driving it.” Mario Draghi also remains committed “to use additional unconventional measures to reach targets”, i.e., a weaker Euro.

If the Euro penetrates 1.2470, it may be time to short.

continue reading »

In business circles, Europeans have often characterized their region of the world as a fickle maiden with many suitors, never quite sure which one to pick and quite clever in never revealing her true intentions. This same characterization can easily be applied to the Euro, as well. Foreign exchange reserve managers and investors have chased after the fickle “EUR/USD” currency pair, thereby buoying its confidence, but the constant attention rarely meets with a satisfactory conclusion. The Euro continues to bounce from one direction to the next, never revealing its true intentions.

Occasionally, however, a fork appears in the road, an obstacle that cannot be ignored and must be addressed. Such a situation exists at present. The Euro is stuck, a technical term that defies definition. Analysts are betwixt and between when it comes to the next moves in the market, but that does not deter them from making bold forecasts for both the near and long-term horizons. If you are looking for convergence in their linear thinking, you will not find it.

The following chart illustrates the current confusion that exists for what’s next:

 

Depending on which analysis you read, the Euro is either progressing in a tight range or ascending a new recovery channel. Each path is designated with dotted-green lines on the 4-Hour chart for the “EUR/USD” pair. The portion of the market that believes that the Euro is ranging is quick to point out that the abundance of short positions almost dictates another leg down. The ECB’s latest attempt at QE will certainly dilute the Euro, putting more downward pressure on it during this brief period of consolidation.

Those on the opposite side of the fence point to the technical data. The Stochastics are rising, and volatility has generally picked up before a rush to higher levels, an old maxim in the trading community. The Euro has broken through resistance at 1.2470 and managed to peak above the repressive Kumo Cloud, if only to be blocked momentarily by the 100-4Hr EMA. For these optimists, history is in their favor, since forex reserve managers and investors have a lot riding on the value of the common currency.

The market power of this group has consistently come to the Euro’s rescue in the past, but 2014 has witnessed increased hesitation on this front, perhaps due to the persistence of unaddressed structural reforms and the lack of positive economic data for the region. Traders that followed a shorting strategy, however, have been burned before, but they may now finally have a real opportunity to recover their prior losses.

What are major banks forecasting for the Euro? BNP Paribas and UBS have updated their forecasts, based on the current situation. Both teams are more concerned about the obvious divergence of U.S. monetary policy and the rest of the world. If 2014 was to be the “Year of the Dollar”, then 2015 and 2016 will both be more of the same. BNPP does not buy into the channel theory. They continue to hold their short position with an ongoing target of 1.18.

UBS takes a more optimistic stance, setting 1.23, 1.25, and 1.20 for their predictions for one-month, 30-days, and 2015, respectively. Their explanation reads as follows, “We concur with the consensus view that the dollar will enjoy healthy gains in 2015 and beyond, but the path is potentially dynamic given that dollar strength could yield both benign and disruptive outcomes, depending on what’s driving it.” Mario Draghi also remains committed “to use additional unconventional measures to reach targets”, i.e., a weaker Euro.

If the Euro penetrates 1.2470, it may be time to short.

continue reading »