Sample Category Title

The Australian Dollar inched up against the Greenback, as the report showed higher business confidence and the Conditions Index remaining at a strong level. The AUD/USD added 8 base points or 0.11% to start the Tuesday session with a solid upmove, touching the 0.7790 mark.

The NAB monthly survey revealed that Australia's Business Confidence Index climbed to 7 points in September, following a steep decline in the prior month when firms were concerned by geo-political tensions with North Korea. In addition, data showed that business conditions held steady at the 15 mark. Overall, the Australian companies' outlook remains upbeat, as the figures indicated that the business sector was doing well in the reported period.

The Euro fell modestly against the American peer, ignoring impressive gains in Germany's industrial production. The EUR/USD currency pair went down just 7 base points or 0.06% to finish the sessions slightly higher in the 1.1740 area.

Destatis revealed that industrial output in Germany rose at a faster-than-expected pace of 2.6% over the month of August, showing the largest monthly gain since July 2011. The strong figure suggested that the European biggest economy is likely to expand in the October quarter. In addition, an upbeat business sentiment and solid increase in industrial orders, which was driven by strong demand particularly from outside the Euro zone, pointed to further upswing in the industrial output.

Cable remains bid on Tuesday but still below Monday's high at 1.3183, posted on short-covering rally.

Cable may extend correction of 1.3655/1.3026 downleg if bulls clearly break above initial barrier at 1.3183, which would open way for further recovery towards pivots at 1.3241 (daily Tenkan-sen), 1.3255 (falling 10SMA) and 1.3266 (Fibo 38.2%), break of which would generate stronger bullish signal.

Series of data from the UK are in focus today. UK Manufacturing Production is expected to rise by 0.2% in Aug vs 0.5% in July, while UK trade balance gap is expected to narrow to 11.2 billion pounds from 11.58 billion pounds gap in the previous month.

Near-term action is supported by 55SMA (1.3133), loss of which would signal an end of correction and shift focus towards key near-term points at 1.3018 (100SMA) and psychological 1.3000 support.

Res: 1.3183, 1.3200, 1.3241, 1.3255
Sup: 1.3133, 1.3110, 1.3074, 1.3026

The Euro is standing at the front foot on Tuesday and extends recovery from last Friday's low at 1.1669.

Comments on Monday from ECB's hawk Lautenschlaeger who called to start winding down asset-buying program, inflated the single currency with fresh boost in early European trading on Tuesday, coming from upbeat German data. Germany's exports and imports rose significantly in August while trade surplus widened to 21.6 billion Euros in August vs 19.3 billion surplus in July and beating forecast for 20 billion Euros.

Markets are also focusing the situation in Spain as Catalonian leaders may declare independence from Spain today, as there were no signs of compromise between secessionist leaders and Spanish government.

Leading European countries, Germany and France put pressure on secessionists, expressing their support to Spain's unity.

The Euro may come under increased pressure if Catalonian leader decide to declare independence, as government in Madrid would respond and likely suspend Catalan autonomy which would further raise tensions and uncertainty. Such scenario could easily drive the single currency through strong supports at 1.1600 zone.

Alternatively, political solution would lower tensions and offer fresh support to the single currency for bullish acceleration through initial barriers at 1.1800/30.

From the technical point of view, EURUSD's near-term studies are bullishly aligned and supportive for further recovery.

On the daily chart, bullish signal was generated on lift above 10 SMA/daily Tenkan-sen at 1.1750 zone, after completion of falling wedge pattern signaled reversal.

This could signal limited upside action as daily techs are negative and plethora of MA barriers that lay above, weighs on near-term action.

Initial resistance lies at 1.1808 (Fibo 38.2% of 1.2033/1.1669 downleg) followed by 1.1832 (29 Sep lower top/converged 20/55SMA in attempt to form bear-cross).

Extended upticks would face strong headwinds and should be ideally capped here as underlying bear-trend from 1.2092 peak is still intact.

Res: 1.1787, 1.1808, 1.1832, 1.1866
Sup: 1.1755, 1.1720, 1.1662, 1.1605

GBPUSD has paused its bearish phase and is making a corrective move after rebounding ahead of the key 1.3000 psychological level. Risks are still tilted to the downside and further weakness is expected since momentum signals are bearish.

MACD is sloping down which highlights the potential for another leg lower in GBPUSD. RSI is in bearish territory below 50 although the decline has stalled, which suggests the market could enter a consolidation phase or bounce higher.

Immediate resistance is expected at 1.3216, which is the 50% Fibonacci retracement level of the upleg from 1.2773 to 1.3656. Above this, further resistance can be found at 1.3318 and 1.3448 before the September 20 peak at 1.3656, the highest since June 2016.

GBPUSD is currently finding support at the 50-day moving average at 1.3131. Breaking below this would turn the focus back to the downside to target the key 1.3000 area. An extension lower would bring the August 24 low at 1.2773 into view.

The short-term bearish bias is still in progress. Only a move back above 1.3200 would indicate that the short-term bearish phase from 1.3656 has ended.

With Japanese and South Korean markets returning from holidays, the dollar failed to gain ground against its rivals as investors continued pricing geopolitical tensions between the US and North Korea. On the other hand, the euro and the aussie were in an uptrend as economic conditions in the regions showed signs of improvement.

The greenback was trading 0.18% lower against its major rivals at 93.54 with markets being cautious whether North Korea will conduct another missile test over the next days, challenging the US and ignoring international warnings.

Dollar/yen hold flat at 112.62 although the BOJ Governor, Haruhiko Kuroda, reiterated to maintain the bank’s ultra-easy monetary policy until inflation breaks stably above the BOJ target of 2%. In terms of data out of Japan, the current account surplus increased unexpectedly to 2.380 trillion yen, while analysts anticipated the figure to decline to 2.262 trillion yen.

Gold was 0.30% up at $1,287.50 per ounce.

Political developments in Spain will be in focus today as the Catalan leader, Carles Puigdemont, is due to address the regional parliament. He is expected to declare unilateral independence despite demonstrations of thousands of people in Barcelona showing their opposition to leave Spain on Sunday. The euro, however, managed to recoup losses and rise to a one-week high of $1.1770 after the ECB’s executive member, Sabine Lautenschlaeger, made some hawkish comments yesterday in Germany, arguing that the central bank should start reducing its asset purchases gradually next year and explaining that factors keeping inflation under pressure are temporary. Upbeat readings on German industrial production and the eurozone’s Sentix investors confidence index released earlier on Monday also provided some support to the currency.

The pound was trading higher by 0.24% at $1.3171, a day after the UK Prime Minister, Theresa May, claimed in the British Parliament that Brexit negotiations made progress on the rights of expatriates and the border with the EU-member Ireland, while she expressed her willingness to achieve a special partnership with the block. However, she added that it is in the EU’s hands for negotiations to move to the next level. Moreover, in her meeting with business leaders yesterday, May said that a two-year transitional period, which will give time for businesses to adjust after Brexit, is not negotiable, according to sources familiar with the matter.

Next up, traders will look forward to evidence on the UK’s industrial production and trade balance, which might shake the currency during the European trading hours.

Australian business confidence gauged by the National Australia Bank (NAB) rose by 2 points to +7 in September, exceeding the forecast of +6. NAB business conditions remained strong, with the corresponding measure holding at +14, near the 9-year high levels. The data pushed the aussie higher to $0.7787, being 0.50% up on the day.

The kiwi fell back to $0.7069 after reaching a session high of $0. 7087 in response to comments made by the leader of New Zealand’s First Party, Winston Peters. Peters, whose party’s support is crucial for the next government to be formed, said that the currency’s weakness due to the inconclusive general elections would “please exporters” given the country’s dependence on overseas sales. September retail sales measured by electronic card transactions released previously grew by 0.1% m/m compared to the 0.7% that was expected. August’s mark was upwardly revised from -0.2% to 0.1%. On a yearly basis, growth in electronic sales decreased from 4.4% to 2.9%.

GBP/USD – 1.3177





Original strategy :

Sell at 1.3200, Target:1.3000, Stop: 1.3260

Position: -

Target:  -

Stop: - 




New strategy :

Sell at 1.3250, Target:1.3050, Stop: 1.3310

Position: -

Target:  -

Stop:- 



As cable has edged higher again today, suggesting near term upside risk remains for the rebound from 1.3027 (last week’s low) to bring retracement of recent decline, hence gain to 1.3220-25 cannot be ruled out, however, reckon 1.3250-60 would limit upside and price should falter well below resistance at 1.3292, bring another decline later. Below 1.3100-05 would suggest the rebound from 1.3027 has ended and bring weakness to 1.3075, then retest of said support at 1.3027, break there would confirm the fall from 1.3658 top is still in progress, bring test of psychological support at 1.3000, then towards 1.2970 but reckon 1.2950 would hold on first testing due to loss of momentum.

In view of this, we are still looking to sell cable on further subsequent recovery as 1.3250 should limit upside, bring another decline later. Above resistance at 1.3292 would abort and signal low has been formed instead, bring at least a correction of the fall from 1.3658 top to another previous support at 1.3343. Our preferred count is that (pls see the attached chart) the wave IV is unfolding as a complex double three (ABC-X-ABC) correction with 2nd wave B ended at 1.2774, hence 2nd wave C could have ended at 1.3658.

Our preferred count on the daily chart is that cable's rebound from 1.3500 (wave (A) trough) is unfolding as a wave (B) with A ended at 1.7043, followed by triangle wave B and wave C as well as wave (B) has ended at 1.7192, the subsequent selloff is the larger degree wave (C) which is still unfolding with minor wave (III) of larger degree wave 3 ended at 1.1986, hence wave (IV) correction is in progress which could either be a triangle wave (IV) of a complex formation but upside should be limited to 1.3500 and price should falter well below 1.4000, bring another decline in wave (V) of 3 for weakness to 1.1500, then 1.1200. 


The British pound continues to hold onto Monday's strong gains against the U.S dollar, as traders scale-back positioning on the greenback, ahead of the release of the FOMC Meeting Minutes.

Intraday trading sentiment surrounding the GBPUSD continues to improve after last week's sharp drop, although positioning may remain neutral until after the release of key UK economic data later today.

Later today, the United Kingdom will release key trade balance, manufacturing and industrial production figures for the month of August.

Any loss of the key 1.3150 level should see selling towards 1.3130 support, while further buying should be expected towards 1.3220 whilst the GBPUSD pair holds above its key 50-day moving average, located at 1.3150.

Key intraday technical GBPUSD support is located at 1.3150, 1.3130 and the pairs key 50-hour moving average, at 1.3108. Further support below the 1.3100 level is found at 1.3075 and 1.3029.

To the upside, key intraday resistance is found at 1.3183 and 1.3204. Once clearly above 1.3204, further resistance is found at 1.3220 and the pairs 200-hour moving average, at 1.3249.

GBP/JPY - 148.20

New strategy :

Stand aside

Position: -
Target:  -
Stop:-

Despite last week’s anticipated decline, sterling found good support at 146.95 and has rebounded, suggesting consolidation above this level would be seen and recovery to 148.55-60, then 149.00 cannot be ruled out, however, price should falter well below resistance at 149.90 and bring another decline later. A break below said support at 146.95 would signal the fall from 152.85 top is still in progress for retracement of recent upmove to 146.60-65 and then 146.00, having said that, loss of momentum should limit downside and previous support at 145.25 should remain intact.

On the upside, whilst recovery to 149.00 cannot be ruled out, indicated resistance at 149.90 should cap upside and bring another decline. A firm break above this level would signal the fall from 152.85 has ended instead, risk test of 150.25 resistance but still reckon upside would be limited to 150.90-95 and price should falter well below resistance at 151.60.

Our preferred count is that larger degree wave V with circle is unfolding from 251.12 with wave (I) 219.34, (II): 241.38 and wave (III) is subdivided into 1: 192.60, 2: 215.89 (23 Jul 2008) and wave 3 ended at 118.87 earlier in 2009. The correction from there to 162.60 is wave 4 which itself is a double three and is labeled as first a-b-c ended at 151.53, followed by wave x at 139.03, 2nd a ended at 162.60, 2nd b at 146.75 and 2nd c leg of wave 4 ended at 163.00. Therefore, the decline from 163.00 to 116.85 is now treated as wave 5 which also marked the end of larger degree wave (III), hence wave (IV) major correction has commenced for retracement of the wave (III) from 241.38 and upside target at 183.95-00 (50% Fibonacci retracement of the wave (II) from 241.38) had been met, a drop below 160.00 would suggest wave (IV) has ended at 195.85, bring decline in wave (V) for initial weakness to 130 (already met) and 120.


The EURUSD pair has moved to its highest trading level since October 5th, after finding a renewed bid tone during today's Asian trading session, hitting 1.1782, as the U.S dollar index comes under mild selling pressure.

Today the euro is likely to remain cautious, as Spanish parliament will convene towards the end of European trading session, to decide the fate of Catalonia's bid for independence.

Technically, the euro has found renewed buying interest after again closing yesterday's daily price-candle above the 1.1710 level, although a daily price-close above the 1.1770 level remains elusive for the single currency.

Should the EURUSD continue to find buying interest above the 1.1800 level today, it is likely to meet strong technical resistance from its key 50-day moving average, at 1.1858, and the euro's monthly pivot, at 1.1875.

Key interim EURUSD technical resistance is found at 1.1787, 1.1805 and the September 29th former swing price-high, at 1.1832.

To the downside, EURUSD technical support is found at the pairs 200-hour moving average, at 1.1751, and the euro's daily pivot point, at 1.1739. Further key intraday support is found at the key 1.1710 and 1.1695 levels.