Sample Category Title

EUR/USD

Current level - 1.1728

The intraday bias is positive above 1.1713, for a test of 1.1830 major resistance. Key support lies at 1.1660.

USD/JPY

Current level - 112.66

My outlook is bearish below 112.90, for a slide towards 112.00 area. 

GBP/USD

Current level - 1.3113

The reversal above 1.3000 signals a positive outlook, for a test of 1.3150. An eventual violation of the latter will challenge 1.3220 zone.

Spot Gold starts the week in positive tone and rose to $1285 so far, after renewed geopolitical tensions over North Korea sparked fresh risk aversion.

The yellow metal extends recovery from last Friday after downtrend from $1357 (08 Sep peak) was contained by daily Ichimoku cloud base at $1265.

Fresh recovery extension generated bullish signal on break above initial barriers at $1278 (falling 10SMA / Tenkan-sen) which could extend recovery through $1292 (4-hr cloud top) and expose key near-term barrier at $1297 (daily cloud top / Fibo 38.2% of $1357/$1260 downleg). Sustained break here is needed to sideline underlying bears and signal stronger recovery.

Broken 100SMA offers strong support at $1273 which is expected to keep the downside protected.

Res: 1285, 1292, 1297, 1300
Sup: 1278, 1275, 1273, 1266

The Aussie dollar remains in red on Monday, under pressure from downbeat Chinese Services PMI data but so far holding above Friday's spike low at 0.7732.

The pair holds in red for four consecutive weeks, with break below thick daily cloud last week seen as strong bearish signal for further extension of current wave C of five-wave sequence from 0.8124, which hit its 200% Fibonacci expansion on Friday and could travel to its FE 238.2% at 0.7665, which is reinforced by 200SMA.

A broken 100SMA cap today's action at 0.7785 and is expected to keep the upside limited, guarding key barrier at 0.7800 (broken daily cloud base, reinforced by falling Tenkan-sen).

Only sustained break above 0.7800 barrier would sideline immediate bears in favor of extended correction.

Res: 0.7785, 0.7800, 0.7825, 0.7865
Sup: 0.7732, 0.7700, 0.7665, 0.7620

Daily Pivots: (S1) 146.74; (P) 147.38; (R1) 147.73; More

With 149.73 minor resistance intact, fall from 152.82 is expected to continue to 61.8% retracement of 139.29 to 152.82 at 144.45. Such decline is seen as a correction and we'd look for strong support from 144.45 to bring rebound. On the upside, break of 149.73 support turned resistance will argue that the pull back is completed and turn bias back to the upside for retesting 152.82 high. However, sustained break of 144.45 will put 139.29 key support in focus.

In the bigger picture, medium term rebound from 122.36 is still expected to resume after corrective pull back from 152.82 completes. Firm break of 38.2% retracement of 196.85 to 122.36 at 150.43 will carry long term bullish implications. In that case, GBP/JPY could target 61.8% retracement at 167.78. However, break of 139.29 will indicate rejection from 150.43 key fibonacci level. And the three wave corrective structure of rebound from 122.36 will argue that larger down trend is resuming for a new low below 122.26.

EUR/USD – 1.1738

EUR/USD:   Wave (c) of 2 ended at 1.3993 and wave 3 of III has commenced for weakness to 1.0411 (1.236 of wave 1), then 1.0000.

Although the single traded lower again last week, the subsequent bounce from Friday’s low of 1.1669 suggests consolidation above this level would be seen and test of 1.1788 cannot be ruled out, however, break there is needed to suggest low is possibly formed, bring further gain to 1.1833 but only break there would signal the fall from 1.2093 top has ended, bring a stronger rebound to 1.1865-70 and then 1.1900-10, however, still reckon upside would be limited to 1.2005 and bring further consolidation. Only break of resistance at 1.2034 would signal the pullback from 1.2093 has ended and recent upmove from 1.0340 low has resumed for retest of 1.2093, then towards 1.2150-55 (61.8% projection of 1.1119-1.1910 measuring from 1.1662), having said that, loss of upward momentum should prevent sharp move beyond 1.2200-10 and price should falter below 1.2255-60, risk from there remains for a much-needed correction to take place later. 

Our preferred count on the daily chart remains that a wave (II) from 1.2329 ended at 1.5145 with A-leg ended at 1.4720, followed by wave B at 1.2457, the wave C from there was also a 3 legged move and is labeled as (a): 1.3739, (b): 1.2885, the wave iii of the 5-waver (c) from 1.2885 has ended at 1.4339 and wave iv is a triangle ended at 1.3878 and wave v formed a top at 1.5145. The decline from there is a 5-waver (C) with minor wave (i) of I of (C) ended at 1.4218 with wave (ii) ended at 1.4580, wave (iii) ended at 1.3267 and wave (iv) ended at 1.3692 and wave (v) ended at 1.1876, this is also the low of wave I of (C) and wave II ended at 1.4940, hence wave III is now in progress with a diagonal wave 1 ended at 1.2042, the breach of previous support at 1.1876 (wave I trough) adds credence to our view that the wave 2 has ended at 1.3993, wave 3 has commenced for further weakness to 1.0411, then towards 1.0000.

On the downside, below said support at 1.1669 would signal the corrective fall from 1.2093 top is still in progress for retracement of recent rise to previous support at 1.1662 (previous 4th of a lesser degree), break there would extend weakness to 1.1600-10 and possibly 1.1550-60 but reckon downside would be limited to 1.1500 and support at 1.1479 should remain intact, bring rebound later. 

Recommendation: Stand aside for this week.

Euro's long-term uptrend started from 0.8228 (26 Oct 2000) with an impulsive structure. The rise from 0.8228 to 0.9593 (5 Jan 2001) is labeled as wave I, the retreat to 0.8352 (6 Jul 2001) is wave II and the rally to 1.3670 (31 Dec 2004) is wave III. Wave IV from there ended at 1.1640 (15 Nov 2005), the subsequent upmove to 1.6040 (July 15, 2008) is treated as wave V, the major selloff from the record high of 1.6040 to 1.2329 (October 27, 2008) signals a reversal has taken place with (I) leg ended at 1.2329 and once (II) ended at 1.5145, wave (III) itself is an extended move with I: 1.1876 and complex wave II ended at 1.4902, wave III has commenced with wave 1 and 2 ended at 1.2042 and 1.3993 respectively, wave 3 of III is now unfolding for weakness towards parity.

Daily Pivots: (S1) 131.84; (P) 132.30; (R1) 132.63; More...

Intraday bias in EUR/JPY remains neutral for the moment. Near term outlook remains bullish as long as 131.69 holds. Sustained break of 134.20 fibonacci level will extend larger up trend to 141.04 resistance next. However, break of 131.69 will be an early sign of medium term reversal and will target 127.55 key support level instead.

In the bigger picture, medium term rise from 109.03 (2016 low) is seen as at the same degree as the down trend from 149.76 (2014 high) to 109.03 (2016 low). 61.8% retracement of 149.76 to 109.03 at 134.20 is already met. Sustained break there will pave the way to key long term resistance zone at 141.04/149.76. However, break of 127.55 support will argue that the medium term trend has reversal and will turn outlook bearish for deeper fall.

Daily Pivots: (S1) 1.5025; (P) 1.5077; (R1) 1.5135; More....

EUR/AUD rises further today but it's still staying below 1.5173 resistance. Intraday bias remains neutral first. On the upside, break of 1.5173/5226 resistance zone will finally resume larger rise from 1.3624. In that case, EUR/AUD will target 1.5644 resistance first. On the downside, break of 1.4791 support will turn bias to the downside and extend the fall from 1.5173 to retest 1.4421 support.

In the bigger picture, we're holding on to the view that corrective decline from 1.6587 medium term top has completed at 1.3624. Rise from 1.3624 is expected to extend to retest 1.6587. The corrective structure of the price actions from 1.5226 is affirming this view. Above 1.5226 will target a test on 1.6587 key resistance. However, break of 1.4421 support will dampen our view and would drag EUR/AUD lower to retest key support zone around 1.3624.

Daily Pivots: (S1) 0.8932; (P) 0.8962; (R1) 0.9004; More...

With 0.8880 minor support intact, EUR/GBP's rebound form 0.8745 is expected extend to 61.8% retracement of 0.9305 to 0.8745 at 0.9091. Break there will target a retest on 0.9305 high. On the downside, below 0.8880 minor support will turn bias to the downside for retesting 0.8745 instead.

In the bigger picture, there are various ways to interpret price actions from 0.9304 high. But after all, firm break of 0.9304/5 is needed to confirm up trend resumption. Otherwise, range trading will continue with risk of another fall. And in that case, EUR/GBP could have a retest on 0.9303 low. But we'd expect strong support from 0.8116 cluster support (50% retracement of 0.6935 to 0.9304 at 0.8120) to contain downside.

Daily Pivots: (S1) 1.1443; (P) 1.1471; (R1) 1.1493; More...

Intraday bias in EUR/CHF remains neutral for at this point. On the downside, break of 1.1387 will extend the corrective fall from 1.1622 to 1.1257 cluster support (38.2% retracement of 1.0652 to 1.1622 at 1.1251). Strong support is expected there to contain downside and bring rebound. Above 1.1497 will extend the recovery. But break of 1.1622 is needed to confirm up trend resumption. Otherwise, the consolidation should continue with risk of at least another fall.

In the bigger picture, long term rise from SNB spike low back in 2015 is still in progress. EUR/CHF should now be heading back to prior SNB imposed floor at 1.2000. For now, this will be the favored case as long as 1.1198 resistance turned support holds.

USD/JPY - 112.63

USD/JPY – Wave V of larger degree circle V has possibly ended at 75.31 and major correction has commenced and already met indicated target at 125.00.

Although the greenback edged higher to 113.44 on Friday, lack of follow through buying and the subsequent retreat suggest consolidation below this level would be seen and initial downside risk is for correction to 112.00, however, reckon downside would be limited to 111.40-50 and renewed buying interest should emerge around 111.10-15 and bring another rise later, above said resistance at 113.44 would signal the rise from 107;32 low is still in progress and may extend further gain to 114.00, then towards 114.30-35 (61.8% Fibonacci retracement of 118.66-107.32 but still reckon resistance at 114.50 would hold on first testing and price should falter below 115.00, bring retreat later.

Our preferred count is that, triangle wave IV (with circle) ended at 101.45 and the circle wave V brought dollar down to the record low of 75.31 in 2011 and the subsequent rebound signal major correction has commenced with A leg ended at 84.19, followed by wave B at 77.14 and impulsive wave C is now unfolding (indicated upside target at 125.00 had been met) for gain towards 127.00 level. In the event dollar drops below support at 99.01, this would confirm medium term decline from 125.86 top (2015 high) has resumed for subsequent weakness to 98.00 and possibly 97.00.

Under this count, this wave C is unfolding as impulsive waves with (1) (2), 1 2 ended at 80.67, 79.07, 82.84 and 81.69 respectively, hence the extended wave 3 has ended at 103.74 and wave 4 correction of recent upmove should bring weakness to 92.57, then towards 90.88 but psychological support at 90.00 should limit downside and bring another rally later in wave 5, indicated target at 125.00 had been met and gain to 127.00 cannot be ruled out but reckon price would falter below 130.00.

On the downside, whilst pullback to 111.50-55 is likely, reckon support at 111.11 would limit downside and bring another rise to aforesaid upside targets later. A daily close below 111.11 would defer and risk weakness to 110.50-60, then towards 110.00 but support at 109.55 should remain intact. Only a drop below strong support at 109.55 would abort and suggest the rebound from 107.32 has ended instead, risk weakness to 109.00 and possibly 108.50-60 but price should stay well above said support at 107.32 and bring another rebound later. 

Recommendation: Buy at 111.15 for 113.15 with stop below 110.15.

On the monthly chart, we have changed our preferred count that an impulsive wave is unfolding with major wave III with circle ended at 79.75, then followed by wave IV with circle and is labeled as a triangle with A: 147.64 (11 August, 1998), B: 101.25, C: 135.20, D: 101.67 and E leg ended at 124.14 to end the wave IV with circle. Hence, wave V with circle commenced from there and hit a record low of 75.31, however, the subsequent strong rebound signals this circle wave V has possibly ended there, hence gain to (indicated upside target at 122.00 and 125.00 had been met), the retreat from 125.86 suggests wave A of major correction has ended there and wave B correction back to 99.00, then 95.00 would be seen, however, reckon downside would be limited to 90.00, bring another rebound in wave C next year.