FX Technical Analysis
EURUSD
Comment: A fourth consecutive 'spike low' type formation against Fibonacci retracement support adds weight to our view that an important long term interim low is forming. Pity it didn't manage a break above 'channel' resistance. Maybe this week. Note that the Euro is not overbought and that momentum is well off being bullish yet.
Strategy: Attempt longs at 1.3750, adding to 1.3670; stop below 1.3500. Add to longs on a sustained break above 1.3800 for 1.3840, then 1.3900.
Direction of Trade: →
Chart Levels:
| Support |
Resistance |
| 1.3726 " |
1.3784 |
| 1.367 |
1.3800* |
| 1.36 |
1.384 |
| 1.357 |
1.387 |
| 1.3530* |
1.3905 |
GBPUSD
Comment: A second consecutive weekly 'hammer' against 61% Fibonacci retracement support adds weight to our view that Cable is trying to form an important medium term low point. A weekly close above 50% retracement support at 1.5275 (also bottom of the massive weekly Ichimoku 'cloud' from mid-April) might turn momentum bullish.
Strategy: Attempt small longs at 1.5185; stop well below 1.5000. Add to longs on a sustained break above 1.5225 for 1.5300 and then more.
Direction of Trade: →
Chart Levels:
| Support |
Resistance |
| 1.5150 " |
1.5218* |
| 1.51 |
1.5275 |
| 1.4873/1.4855* |
1.5300/1.5327* |
| 1.48 |
1.542 |
| 1.4781** |
1.5575* |
USDJPY
Comment: Having reached our upside target at 91.00 (high 91.09) watch for signs of topping here. This may be a messy slow process but Friday's 'doji' at the very top edge of the Ichimoku 'cloud' underlines the instability at current levels. Continue to allow for a series of random moves roughly between 91.00 and 88.00.
Strategy: Sell at 90.65, adding to 91.00; stop well above 91.15. First downside target 90.20, then 89.30/89.00
Direction of Trade: →
Chart Levels:
| Support |
Resistance |
| 90.55 " |
90.83 |
| 90.15 |
90.97 |
| 89.8 |
91.00/91.09* |
| 89.3 |
91.28 |
| 89.00* |
91.60* |
EURJPY
Comment: Having moved up to 125.00 as expected. A sustained break out of the small range of the last five weeks (120.00 to 125.00) looks unlikely on a first attempt and therefore expect hesitation in a small range today.
Strategy: Possibly attempt small shorts at 124.65/125.00; stop above 125.55. First target 123.65.
Direction of Trade: →
Chart Levels:
| Support |
Resistance |
| 124.40 " |
124.95 |
| 124 |
125.24/125.36* |
| 123.65 |
125.75 |
| 123 |
126.45 |
| 122.5 |
127.08* |
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.
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