Sample Category Title

EUR/USD - 1.1590

Most recent candlesticks pattern   : N/A

Trend                      : Down

Tenkan-Sen level              : 1.1600

Kijun-Sen level                  : 1.1621

Ichimoku cloud top             : 1.1664

Ichimoku cloud bottom      : 1.1649

Original strategy  :

Sold at 1.1620, Target: 1.1520, Stop: 1.1655

Position : - Short at 1.1620

Target :  - 1.1520

Stop : - 1.1655

New strategy  :

Hold short entered at 1.1620, Target: 1.1520, Stop: 1.1655

Position : - Short at 1.1620

Target :  - 1.1520

Stop : - 1.1655

The single currency dropped after meeting renewed selling interest at 1.1691, adding credence to our view that top has been formed there and consolidation with downside bias remains for weakness to previous support at 1.1574, however, break there is needed to confirm recent decline has resumed and extend fall to 1.1520-25, then 1.1500 but near term oversold condition should prevent sharp fall below latter level. 

In view of this, we are holding on to our short position entered at 1.1620. Above 1.1650-55 would risk another bounce to 1.1691, however, only break there would abort and suggest further choppy trading above 1.1574 and bring a stronger rebound to 1.1700-05 but upside should be limited to previous support at 1.1725 (now resistance). 

USD/JPY - 114.11

Most recent candlesticks pattern   : N/A

Trend                      : Near term up

Tenkan-Sen level              : 114.19

Kijun-Sen level                  : 114.19

Ichimoku cloud top             : 113.97

Ichimoku cloud bottom      : 113.91

Original strategy  :

Buy at 113.85, Target: 114.85, Stop: 113.50

Position :  -

Target :  -

Stop : -

New strategy  :

Buy at 113.85, Target: 114.85, Stop: 113.50

Position :  -

Target :  -

Stop : -

Although the greenback broke above indicated previous resistance at 114.45-50, lack of follow through buying and current retreat fro 114.74 suggest consolidation below this level would be seen and marginal weakness from here cannot be ruled out, however, reckon 113.75-80 would limit downside and bring another rise later, above said resistance at 114.74 would extend recent upmove from 107.32 to 115.00 but overbought condition should limit upside to another previous resistance at 115.51.

In view of this, we are looking to buy dollar on pullback as 113.80 should limit downside and bring another rise later. Below support at 113.54 would abort and prolong consolidation, risk weakness to 113.20-25, however, reckon support at 112.96 would remain intact, bring another rise later.

Daily Pivots: (S1) 113.60; (P) 114.01; (R1) 114.44; More...

Intraday bias in USD/JPY remains cautious on the upside at this point. Rally from 107.31 is possibly resuming. Sustained trading above 114.49 will pave the way to retest 118.65 high. However, break of 112.95 support will now indicate rejection from 114.49 and turn bias to the downside for 111.64 support and below.

In the bigger picture, medium term rise from 98.97 (2016 low) is not completed yet. It should resume after corrective fall from 118.65 completes. Break of 114.49 resistance will likely resume the rise to 61.8% projection of 98.97 to 118.65 from 107.31 at 119.47 first. Firm break there will pave the way to 100% projection at 126.99. This will be the key level to decide whether long term up trend is resuming.

Daily Pivots: (S1) 0.9953; (P) 0.9988; (R1) 1.0039; More....

USD/CHF is staying in consolidation from 1.0037 and intraday bias remains neutral at this point. In case of another fall, downside should be contained above 0.9835 resistance turned support and bring rally resumption. On the upside break of 1.0037 will resume whole rally from 0.9420. And with sustained trading above 61.8% retracement of 1.0342 to 0.9420 at 0.9990, USD/CHF should then target a test on 1.0342 key resistance.

In the bigger picture, current development suggests that USD/CHF has defended 0.9443 (2016 low) key support level again. Rise from 0.9420 could is a medium term up move and should target a test on 1.0342 high. This represents the upper end of a long term range that started back in 2015. On the downside, break of 0.9736 support is now needed to indicate completion of the rise from 0.9420. Otherwise, further rally will remain in favor in medium term.

EUR/GBP - 0.8841

New strategy  :

Sell at 0.8865, Target: 0.8735, Stop: 0.8905

Position : -

Target :  -

Stop : -

 
As the single currency has retreated after rising to 0.8939 late last week, suggesting consolidation below this level would be seen and weakness to 0.8800 is likely, however, break of support at 0.8765-70 is needed to signal the rebound from 0.8733 (last week’s low) has ended, bring retest of this level, break there would extend the fall from 0.9033 to 0.8700 but near term oversold condition should limit downside and reckon 0.8665-70 would remain intact.

In view of this, we are looking to sell euro on recovery as 0.8870-75 should limit upside. Only above 0.8910-15 would abort and signal the retreat from 0.8939 has ended, bring retest of this level first, break there would extend the rise from 0.8733 to resistance at 0.8957, however, break of 0.8976 resistance is needed to signal the fall from 0.9033 has ended instead, bring further gain to 0.9000, then retest of 0.9033 later.

Our preferred count is that, after forming a major top at 0.9805 (wave V), (A)-(B)-(C) correction is unfolding with (A) leg ended at 0.8400 (A: 0.8637, B: 0.9491 and 5-waver C ended at 0.8400. Wave (B) has ended at 0.9413 and impulsive wave (C) has either ended at 0.8067 or may extend one more fall to 0.8000 before prospect of another rally. Current breach of indicated resistance at 0.9043 confirms our view that the (C) leg has ended and bring stronger rebound towards 0.9150/54, then towards 0.9240/50.

Daily Pivots: (S1) 1.3032; (P) 1.3079; (R1) 1.3118; More....

No change in GBP/USD's outlook. With 1.3138 minor resistance intact, intraday bias remains mildly on the downside. Break of 1.3026 support will confirm resumption of decline from 1.3651. Next target will be 61.8% projection of 1.3651 to 1.3026 from 1.3320 at 1.2934 first. Break will bring deeper decline to 1.2773 key support level. On the upside, above 1.3138 minor resistance will extend the consolidation from 1.3026 with another rise.

In the bigger picture, as noted before, GBP/USD hit strong resistance from the long term falling trend line. Current development is starting to favor that corrective rebound from 1.1946 low has completed at 1.3651. Decisive break of 1.2773 will confirm this bearish case and target a test on 1.1946 low next, with prospect of resuming the low term down trend. Nonetheless, break of 1.3320 resistance will restore the rise from 1.1946 for 38.2% retracement of 2.1161 (2007 high) to 1.1946 (2016 low) at 1.5466.

Daily Pivots: (S1) 1.1574; (P) 1.1632 (R1) 1.1666; More...

EUR/USD dips mildly today but it's staying above 1.1574 support. Intraday bias remains neutral and more consolidation could be seen. But after all, break of 1.1879 resistance is needed to confirm completion of the decline from 1.2091. Otherwise, near term outlook will stay bearish. Below 1.1574 will target 38.2% retracement of 1.0569 to 1.2091 at 1.1510.

In the bigger picture, rise from 1.0339 medium term bottom is seen as a corrective move for the moment. Therefore, in case of another rally, we'd be cautious on 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516 to limit upside and bring reversal. Meanwhile, sustained trading below 55 week EMA will suggest that such medium term rebound is completed and could then bring retest of 1.0339 low.

The direction in the Forex markets is no too clearly today. Yen was initially sold off earlier but there was no follow through selling so far. Instead, Euro is back under some selling pressure despite solid economic data. On the other hand, Dollar is mixed as US President Donald Trump's trip to Asia is no providing any inspiration to the markets. Instead, eyes will stay on the progress of the tax plan in Congress. But for now, in a rather light week, attention will be on RBA rate decision in the upcoming Asian session.

Trump gives no inspiration as a salesman in Asia

The way US President Donald Trump fed fish in the koi pond in Japan could have caught some headlines. But underneath, Trump is doing his salesman job there in his trip. He claimed that Japan Prime Minister Shinzo Abe will "shoot" North Korean missiles "out of the sky" when Abe completes the "purchase of lots of additional military equipment from the United States". But earlier he accused Japan for the trade surplus with US. He said that "the United States has suffered massive trade deficits at the hands of Japan for many, many years." He went further and said that "right now our trade with Japan is not free and it's not reciprocal" and pledged that "it will be done in a quick and very friendly manner."

Meanwhile the markets are keeping an eye on those who are doing real business at home in the US. House Speaker Paul Ryan said his chamber could pass a Republicans backed tax reform plan by Thanksgiving. And Ryan expects Senate to follow about a week later. Ryan also defended against criticisms that the tax plan would add US 1.5T to deficit. He emphasized that "Paul Ryan Deficit Hawk is also a growth advocate. Paul Ryan Deficit Hawk also knows that you have to have a faster growing economy, more jobs, bigger take home pay, that means higher tax revenues." 

ECB Peter explains ECB's decision on APP

ECB chief economist Peter Praet explained ECB's decisions to half monthly asset purchase to EUR 30b and extend the program by nine months. He noted that "when considering the appropriate calibration of the asset-purchase program there were three important dimensions to consider: pace, horizon and optionally." He reiterated the view that "the brighter economic prospects have increased our confidence in the gradual convergence of inflation toward our aim. This called for a lower pace of purchases."

Also, "we have always emphasized that monetary policy needs to be persistent and patient for underlying inflation pressures to gradually build up." Therefore, "the longer horizon also anchors short-term interest-rate expectations for a longer period, thereby reinforcing the Governing Council's forward guidance on policy rates."

Eurozone Sentix confidence hit highest since 2007

Eurozone Sentix Investor Confidence rose to 34.0 in November, up from 29.7 and beat expectation of 31.0. That's also the highest reading since July 2007. Meanwhile, current situation gauge rose to 45.8, up from 41.8. Expectation gauge rose to 22.8, up from 18.3. Sentix noted that "both situation and expectations contribute to this positive development. Things are even better in Germany, where we can report all-time highs." 

Also from Eurozone, PPI rose 0.6% mom in September. Services PMI was revised up to 55.0 in October. Italy services PMI dropped to 52.1 in October. German factory orders rose 1.0% mom in September.

Swiss CPI was unchanged at 0.70% mom yoy in October.

RBA widely expected to stand pat

RBA rate decision will be a main focus in the upcoming Asian session. The central bank is widely expected to keep the Cash Rate unchanged at 1.50%. That will be the 15 straight months RBA stands pat. The last time there was a move, RBA cut interest rate by -25bps back in August 2016. Governor Philip Lowe has repeatedly stated his stance that RBA won't follow some other global central banks in stimulus exit. And there are speculations that RBA could lower near term GDP forecasts as recent data disappointed. More importantly, if there would be a downgrade in inflation forecast, we could see another round of selloff in Aussie.

AUD/NZD was shot higher briefly after New Zealand Election, but there was no follow through buying since then. Even though the markets are unhappy with the new labor-led coalition in New Zealand, Aussie has indeed under-performed in the past two weeks. It's early to call for a trend reversal in the cross with 1.0832 support intact. But for now, 1.1331 resistance looks solid and AUD/NZD will feel heavy as it approaches this level.

EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.1574; (P) 1.1632 (R1) 1.1666; More...

EUR/USD dips mildly today but it's staying above 1.1574 support. Intraday bias remains neutral and more consolidation could be seen. But after all, break of 1.1879 resistance is needed to confirm completion of the decline from 1.2091. Otherwise, near term outlook will stay bearish. Below 1.1574 will target 38.2% retracement of 1.0569 to 1.2091 at 1.1510.

In the bigger picture, rise from 1.0339 medium term bottom is seen as a corrective move for the moment. Therefore, in case of another rally, we'd be cautious on 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516 to limit upside and bring reversal. Meanwhile, sustained trading below 55 week EMA will suggest that such medium term rebound is completed and could then bring retest of 1.0339 low.

Economic Indicators Update

The Canadian dollar is almost unchanged in the Monday session. Currently, USD/CAD is trading at 1.2754, down 0.07% on the day. On the release front, Canada will release Ivey PMI, which is expected to improve to 60.2 points. In the US, FOMC member William Dudley will speak, and could announce his retirement from the Federal Reserve. On Tuesday, Fed Chair Janet Yellen and Bank of Canada Governor Stephen Poloz will speak at public engagements.

Canadian employment data was sharp on Friday, as the economy produced 35.3 thousand jobs, well above the estimate of 15.3 thousand. This marked the highest gain since June. South of the border, job numbers were a disappointment. After a decline in September, a result of the hurricanes which battered the US, nonfarm payrolls rebounded sharply with a reading of 261 thousand. This was a respectable number, but still fell short of the forecast of 312 thousand. Wage growth also disappointed, slowing to 0.0%, short of the estimate of 0.2%. This marked the first time in 2017 that wage growth did not increase, underlining persistent weak inflation. Although Fed Chair Yellen and other Fed policymakers have expressed confidence that inflation levels will rise, this is still yet to occur, despite strong growth and a labor market at capacity.

On Thursday, US President Trump nominated Federal Reserve Governor Jerome Powell to head the Federal Reserve. Powell will take over in February 2018 when Yellen's term expires. Powell is expected to hold the course with monetary policy, which has been marked by incremental and small rate hikes since December 2015. It's all but a given that the Fed will raise interest rates in December, but the forecast for 2018 is less clear. If the US economy continues to grow at current levels, we could see up to three rate hikes next year. Powell will also be tasked with continuing to trim the Fed's huge balance sheet of $4.2 billion. Last month, the Fed has started trimming the balance sheet by $10 billion/mth, but these cuts are expected to increase in size next year.

The euro continues to decline against the U.S dollar on Monday, despite a series of stronger than expected economic data releases from the Eurozone. The EURUSD currently trades around the 1.1590 level, as U.S dollar index strength continues to force the pair lower. Earlier, the Eurozones Sentix Investors Confidence Survey rose sharply for the month of November, with the German reading hitting an all-time High. October PPI inflation figures also continued to improve in the Eurozone, with a 0.6 percent monthly gain.

The EURUSD pair remains strongly technically bearish while trading below the 1.1610 level. Intraday euro selling is likely to increase below 1.1610, with further declines towards the 1.1573 and 1.1510 levels expected.

Should price action move back above the 1.1610 technical level, euro buyers will likely push price-action back towards the key 1.1640 resistance level.