FX Technical Analysis
EURUSD
Comment: Hovering nervously above a new recent low at 1.3444 in what is a potential C leg of an A, B, C-type correction where C is 0.6% of A. With EU27 finance ministers delivering absolutely nothing, zero, nul points, in terms of helping in this crisis well, with friends like these… The Euro is oversold and bearish momentum its strongest ever, one-month at-the-money implied volatility at 19.00% is at a new record high. Stand aside if possible.
Strategy: For those who have to: attempt tiny longs at 1.3550; stop below 1.3400. First target 1.3700, then 1.3900.
Direction of Trade: →
Chart Levels:
| Support |
Resistance |
| 1.3544 " |
1.3644 |
| 1.3444* |
1.3672 |
| 1.34 |
1.3743 |
| 1.3360* |
1.385 |
| 1.33 |
1.3915* |
GBPUSD
Comment: Trying to form a 'double bottom' against the 1.7400 area but getting no help from the government. One-month at-the-money implied volatility at 17.90% is at its highest in at least 15 years. Cable is oversold and bearish momentum has halved since mid-September.
Strategy: Attempt small longs at 1.7435; stop below 1.7300. Short term target 1.7600, maybe 1.7800
Direction of Trade: →
Chart Levels:
| Support |
Resistance |
| 1.7427 " |
1.76 |
| 1.7320* |
1.766 |
| 1.725 |
1.7736 |
| 1.7188 |
1.7839 |
| 1.7045* |
1.7878 |
USDJPY
Comment: Excited journalists as the Yen drops below the psychological 100.00. One-month at-the-money implied volatility at 22.00% is close to its highest ever but could still go even higher to the 1998 high of 34.75%. The USD is oversold and momentum is clearly bearish. We still favour several vicious swings roughly between 100.00 and 104.00 for another three days. Then lower still as finance minister Nakagawa intelligently decides that commenting on FX or stocks in the current situation is not a good idea.
Strategy: Possibly attempt tiny shorts at 100.00, but only if prepared to add to 103.00; stop above 104.50. Short term target 99.60, then March's low at 95.77
Direction of Trade: →↘
Chart Levels:
| Support |
Resistance |
| 99.61/99.50* " |
100 |
| 98.75 |
101 |
| 98.56 |
101.75 |
| 97.67 |
102 |
| 96.86 95.77** |
103.30* |
EUR/JPY
Comment: Clinging to support at 135.00 and hopefully should consolidate cautiously around here for a few more days. Do not hold your breath though as bearish momentum is at a record. One-month at-the-money implied volatility at 22.40% is just a whisper from the 1998 equivalent peak at 23.00%.
Strategy: Possibly attempt small longs at 136.00; stop/reverse below 135.00 for 130.00. Cover longs between 139.00 and 141.00 and wait.
Direction of Trade: →↘
Chart Levels:
| Support |
Resistance |
| 135.45 " |
137 |
| 135.00** |
137.3 |
| 137.75 |
138 |
| 136.64 |
138.66 |
| 135.05** |
139.30 141.00* |
Mizuho Corporate Bank
Disclaimer
The information contained in this paper is based on or derived from information generally available to the public from sources believed to be reliable. No representation or warranty is made or implied that it is accurate or complete. Any opinions expressed in this paper are subject to change without notice. This paper has been prepared solely for information purposes and if so decided, for private circulation and does not constitute any solicitation to buy or sell any instrument, or to engage in any trading strategy.
|
