Sample Category Title

USD/CHF - 0.9648

Original strategy :

Buy at 0.9600, Target: 0.9700, Stop: 0.9565

Position : -

Target :  -

Stop : -

New strategy  :

Buy at 0.9600, Target: 0.9700, Stop: 0.9565

Position : -

Target :  -

Stop : -

Although the greenback has recovered after finding support at 0.9637 yesterday, reckon resistance at 0.9727 would limit upside and bring further consolidation below this level, hence risk of another retreat to 0.9635 (38.2% Fibonacci retracement of 0.9490-0.9727) remains, however, previous resistance at 0.9596 should turn into support and contain downside, bring another rise later, above said resistance at 0.9727 would extend recent rise to 0.9750-60, then 0.9780 but reckon 0.9800 would hold from here.
 
In view of this, would not chase this rise here and would be prudent to buy dollar on subsequent pullback as previous resistance at 0.9596 should turn into support and contain dollar’s downside. Below 0.9580 (61.8% Fibonacci retracement of 0.9490-0.9727) would defer and suggest a temporary top is formed instead, bring correction to 0.9540-50 but price should stay well above support at 0.9490, bring another rise later. 

GBP/USD - 1.3224

Original strategy :

Buy at 1.3130, Target: 1.3230, Stop: 1.3095

Position : - 

Target :  -

Stop : -

New strategy  :

Buy at 1.3130, Target: 1.3230, Stop: 1.3095

Position : -

Target :  -

Stop : -

Yesterday’s rally above previous resistance at 1.3159 confirms recent upmove has resumed and upside bias is seen for further gain to 1.3240-50, however, near term overbought condition should prevent sharp move beyond 1.3275-80 and reckon 1.3300-10 would hold from here, risk from there has increased for a retreat to take place later.

In view of this, would not chase this rise here and would be prudent to buy cable on pullback as the upper Kumo (now at 1.3123) should limit downside, bring another upmove later. Below 1.3105-10 would defer and risk test of support at 1.3097 but only break there would signal a temporary top is possibly formed, bring further fall towards previous support at 1.3052.

EUR/USD - 1.1810

Original strategy  :

Buy at 1.1750, Target: 1.1850, Stop: 1.1715

Position : -

Target :  -

Stop : -

New strategy  :

Buy at 1.1750, Target: 1.1850, Stop: 1.1715

Position : -

Target :  -

Stop : -

As the single currency has maintained a firm undertone after yesterday’s rally above last week’s high at 1.1777, adding credence to our bullish view that recent upmove from 1.0340 low is still in progress and upside bias remains for further gain to 1.1850-55 (50% projection of 1.1370-1.1777 measuring from 1.1650) but loss of near term upward momentum should prevent sharp move beyond 1.1875-80 and price should falter below 1.1900-05 (61.8% projection), risk from there has increased for a retreat later.

In view of this, would not chase this rise here and would be prudent to buy euro on pullback as 1.1750 should limit downside. Below said support at 1.1723 would defer and suggest top is possibly formed, bring retracement of recent rise to 1.1690-95 first but indicated support at 1.1650 should hold. 

Key Highlights

• The Aussie Dollar is in an uptrend and positioned nicely above the 0.7950 support against the US Dollar.
• There is a crucial ascending channel pattern forming with support at 0.7980 on the 4-hours chart of AUD/USD.
• Today, the RBA Interest Rate Decision Number 2017-15 was announced, and the central bank decided to keep rates at 1.5%.
• The AiG performance of the Mfg Index for June 2017 posted an increase from 55 to 56.

AUDUSD Technical Analysis

The past few days were good for the Aussie Dollar, as it moved above 0.8000 against the US Dollar. The AUD/USD pair is currently placed well and looks set to extend gains above 0.8060.

After trading as high as 0.8065, the pair started a correction and moved towards 0.7950. The 0.7960-50 held declines and protected a downside break. Looking at the 4-hours chart, there a crucial ascending channel pattern forming with support at 0.7980.

The pair recently failed near the 76.4% Fib retracement level of the last decline from the 0.8065 high to 0.7936 low. However, it remains supported near 0.8000 and 0.7980. As long as the channel support and 0.7950 is intact, the pair may aim a new monthly high.

RBA Interest Rate Decision

Today, the Interest Rate Decision Number 2017-15 was announced by the Reserve Bank of Australia. The market forecast was no change from 1.5%, and the result was the same.

The central bank statement highlighted the recent rise in AUD/USD. The report mentioned:

The Australian dollar has appreciated recently, partly reflecting a lower US dollar. The higher exchange rate is expected to contribute to subdued price pressures in the economy. It is also weighing on the outlook for output and employment. An appreciating exchange rate would be expected to result in a slower pick-up in economic activity and inflation than currently forecast.

However, the AUD/USD pair not impacted, but there was a minor dip towards 0.8010 after the release.

AiG performance of the Mfg Index

Today, the AiG performance of the Mfg Index for June 2017 was published by the Australian Industry Group. The market forecast was no change in the index from 55.

The actual result was better, as there was an increase from the last reading of 55 to 56. Both New orders and sales were up to 55.8 points and 55.8 points respectively.

The report added that:

In July manufacturers cited increased demand from construction, mining (possibly reflecting commodity price increases) and agriculture for locally manufactured construction materials, machinery and equipment.

Overall, the AUD/USD pair remains in an uptrend and it may soon attempt a break above the last high of 0.8065 in the near term.

USD/JPY - 110.54

Original strategy  :

Sell at 110.75, Target: 109.75, Stop: 111.10

Position :  -

Target :  -

Stop : -

New strategy  :

Sell at 110.90, Target: 109.90, Stop: 111.25

Position :  -

Target :  -

Stop : -

As the greenback has rebounded after falling to 110.00, suggesting consolidation above this level would be seen and corrective bounce to 110.77 (yesterday’s high) cannot be ruled out, however, reckon the upper Kumo (now at 111.01) would limit upside and bring another decline, below said support at 110.00 would extend recent decline from 114.50 to 109.75-80 but loss of downward momentum should limit downside to 109.50 and reckon 109.20-25 would hold.

In view of this, would not chase this fall here and would be prudent to sell dollar again on subsequent recovery as said resistance at 110.77 should limit upside. Above 111.10 (50% Fibonacci retracement of 112.20-110.00) would defer and risk test of 111.29 resistance but only break there would signal a temporary low is formed instead, bring rebound to 111.50-55 first.

Daily Pivots: (S1) 110.36; (P) 110.84; (R1) 111.14; More...

Intraday bias in USD/JPY remains on the downside for further decline to 108.81 support. Break there will resume whole correction from 118.65 and target 61.8% retracement of 98.97 to 118.65 at 106.48. Nonetheless, break of 112.18 resistance will dampen this bearish view and turn focus back to 114.49 resistance instead.

In the bigger picture, the corrective structure of the fall from 118.65 suggests that rise from 98.97 is not completed yet. Break of 118.65 will target a test on 125.85 high. At this point, it's uncertain whether rise from 98.97 is resuming the long term up trend from 75.56, or it's a leg in the consolidation from 125.85. Hence, we'll be cautious on topping as it approaches 125.85. If fall from 118.65 extends lower, down side should be contained by 61.8% retracement of 98.97 to 118.65 at 106.48 and bring rebound.

Daily Pivots: (S1) 0.9632; (P) 0.9672; (R1) 0.9708; More...

Intraday bias in USD/CHF remains neutral for the moment. Another rise is expected as long as 0.9594 support holds. Prior break of 0.9699 resistance suggests near term reversal after defending 0.9443 key support. Above 0.9726 will target 38.2% retracement of 1.0342 to 0.9437 at 0.9783 first. Break will target channel resistance (now at 0.9899). However, firm break of 0.9594 will dampen this bullish view and turn bias back to the downside for 0.9437.

In the bigger picture, current development argues that USD/CHF has successfully defended 0.9443 key support level. And long term range trading in 0.9443/1.0342 is extending with another rise. At this point, there is no sign of an up trend yet. Hence, while further rise is expected in USD/CHF, we'll start to be cautious on loss of momentum above 61.8% retracement of 1.0342 to 0.9437 at 0.9996.

Daily Pivots: (S1) 1.3129; (P) 1.3176; (R1) 1.3255; More...

Intraday bias in GBP/USD remains on the upside for the moment. Current rally could target 1.3444 key resistance. But still, price actions from 1.1946 are viewed as a corrective pattern. Hence, we'll look for topping signal again around 1.3444. On the downside, below 1.3096 minor support will turn bias neutral first. Further break of 1.2932 support will indicate reversal and will turn bias to the downside to target 1.2588 key support next.

In the bigger picture, overall, price actions from 1.1946 medium term low are seen as a corrective pattern that is still in progress. While further upside is expected, larger outlook remains bearish as long as 1.3444 key resistance holds. Down trend from 1.7190 (2014 high) is expected to resume later after the correction completes. And break of 1.2588 will indicate that such down trend is resuming.

Daily Pivots: (S1) 1.1760; (P) 1.1802 (R1) 1.1883; More...

Intraday bias in EUR/USD remains on the upside for the moment. Current rise 1.0339 should target 1.2 handle next. Firm break there will pave the way to next key fibonacci level at 1.2516. On the downside, below 1.1722 minor support will turn intraday bias neutral and bring consolidation before staying another rally.

In the bigger picture, an important bottom was formed at 1.0339 on bullish convergence condition in weekly MACD. Sustained break of 55 month EMA (now at 1.1760) will pave the way to key fibonacci level at 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. While rise from 1.0339 is strong, there is no confirmation that it's developing into a long term up trend yet. Hence, we'll be cautious on strong resistance from 1.2516 to limit upside. But for now, medium term outlook will remain bullish as long as 1.1295 support holds, in case of pull back.

European majors are generally the strong ones this week so far. While Euro and Sterling lost some intraday momentum after yesterday's rally, they're both remain firm as supported by solid economic data. ON the other hand, While data from US are not too back, the greenback is being pressured by the political drama in the White House. Aussie is leading commodity currencies down as RBA warned of its recent appreciates in the rate decision statement. In other markets, US futures point to high open as DOW would likely extend the record run. Gold continues to ride on Dollar Weakness and stays firm above 1270. WT crude oil is hovering around 50 for the moment and is trying to find follow through buying above this level. Release from US, person income rose 0.0% in June, below expectation of 0.4%. Personal spending rose 0.1%, in line with consensus. Headline PCE slowed to 1.4% yoy but beat expectation of 1.3% yoy. Core PCE was unchanged at 1.5% yoy, above expectation of 1.4% yoy.

Quick update: ISM Manufacturing missed expectation by 0.1 by dropping to 56.3 in July. But price paid gauge surprised on the upside by rising to 62.0.

UK PMI manufacturing shows growth acceleration

UK PMI manufacturing rose to 55.1 in July, up from 54.2, above expectation of 54.5. Markit noted that "UK manufacturing started the third quarter on a solid footing". The PMI indicated a "a growth acceleration for the first time in three months during July, as new order intakes were boosted by a near survey-record increase in new export business." Besides the help from lower Sterling exchange rate, "manufacturers also benefited from stronger economic growth in key markets in the euro area, North America and Asia-Pacific regions." Also, Markit added that "continued expansion is also still filtering through to the labour market, with the latest round of manufacturing job creation among the best seen over the past three years."

Eurozone GDP rose 17 quarters in a row, accelerated in Q2

The economic outlook of Eurozone seems even brighter as GDP growth accelerated to 0.6% qoq in Q2, in line with consensus. That's the 17 quarters of growth in a row, which started back in early 2013. Also from Eurozone, Germany unemployment dropped -9k in July, larger than expectation of -5k fall. Unemployment rate was unchanged at 5.7%. Eurozone PMI manufacturing was revised down by 0.2 to 56.6 in July. Italy PMI manufacturing dropped 0.1 to 55.1 in July.

RBA Maintained Status Quo, Warned that Strong Aussie is Curbing Growth

As widely anticipated, the RBA left the cash rate unchanged at 1.5%. Policymakers acknowledged that June inflation drifted back below the +2% target but remained confident it would improve gradually alongside the pickup of the economy. Policymakers, however, warned of Australian dollar's appreciation, suggesting that it would limit economic growth. A reference of the negative impact of strong currency on economic developments reappeared as AUDUSD has risen +5.7% from July's low of 0.7567. More in RBA Maintained Status Quo, Warned that Strong Aussie is Curbing Growth

Elsewhere

China Caixin PMI manufacturing rose to 51.1 in July, up from 50.4, and beat expectation of 50.4. It's noted in the statement that "panelists widely commented on an improvement in market conditions and strong foreign demand. Notably, new export sales increased at the second-fastest rate since September 2014." New export orders jumped sharply from 50.9 to 53.5, hitting the highest level since February.

EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.1760; (P) 1.1802 (R1) 1.1883; More...

Intraday bias in EUR/USD remains on the upside for the moment. Current rise 1.0339 should target 1.2 handle next. Firm break there will pave the way to next key fibonacci level at 1.2516. On the downside, below 1.1722 minor support will turn intraday bias neutral and bring consolidation before staying another rally.

In the bigger picture, an important bottom was formed at 1.0339 on bullish convergence condition in weekly MACD. Sustained break of 55 month EMA (now at 1.1760) will pave the way to key fibonacci level at 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. While rise from 1.0339 is strong, there is no confirmation that it's developing into a long term up trend yet. Hence, we'll be cautious on strong resistance from 1.2516 to limit upside. But for now, medium term outlook will remain bullish as long as 1.1295 support holds, in case of pull back.

Economic Indicators Update