Sample Category Title

USD/CAD - 1.3496

 
Recent wave: Only wave v of c has ended at 0.9407 and wave C of major A-B-C correction is underway for headway to 1.4700

Trend:  Near term up

 
Original strategy       :

Sell at 1.3560, Target: 1.3360, Stop: 1.3620

Position: -

Target:  -

Stop: -

 
New strategy             :

Sell at 1.3580, Target: 1.3380, Stop: 1.3640

Position: -

Target:  -

Stop:-

Although the greenback retreated after meeting resistance at 1.3547 late last week, reckon downside would be limited to 1.3460-65 and upside risk remains for another rebound to 1.3550 but 1.3575-80 (50% Fibonacci retracement of 1.3770-1.3387) should limit upside and bring another decline, below 1.3460-65 would bring test of 1.3436 support, break there would signal the rebound from 1.3387 has ended, bring retest of this level first. A drop below this support at 1.3387 would extend the fall from 1.3794 top for further weakness to 1.3350, then towards 1.3300 but loss of near term downward momentum should prevent sharp fall below 1.3250-60.

In view of this, would be prudent to sell on further subsequent recovery as 1.3571-79 (previous support and 50% Fibonacci retracement of 1.3770-1.3387) should limit upside and bring another decline. Above 1.3620-25 (61.8% Fibonacci retracement) would defer and suggest a temporary low is formed instead, risk a stronger rebound towards resistance at 1.3670.

To recap, wave B from 1.3066 is unfolding as an a-b-c and is sub-divided as a: 1.2192, b: 1.2716 and wave c is a 5-waver with i: 1.1983, ii: 1.2506, extended wave iii with minor iii at 1.0206, wave iv ended at 1.0781 and wave v as well as wave iii has ended at 0.9931, hence the subsequent choppy trading is the wave iv which is unfolding as (a)-(b)-(c) with (a) leg of iv ended at 1.0854, followed by (b) leg at 1.0108 and (c) leg as well as the wave iv ended at 1.0674. The wave v is sub-divided by minor wave (i): 0.9980, (ii): 1.0374, (iii): 0.9446, (iv): 0.9913 and (v) as well as v has possibly ended at 0.9407, therefore, consolidation with upside bias is seen for major correction, indicated target at 1.3700 and 1.4000 had been met and further gain to 1.4700 would be seen later.

EUR/GBP has seen a noticeable 4.3% gain since May 11, helped by the strengthening of EUR.

On the daily chart EUR/GBP has been trading above the downside 10-day SMA support since then.

However, in early European session today, the bulls have retraced after hitting a 12-week high of 0.8766, as trading below the significant resistance level at 0.8800, where there is heavy pressure.

Currently, the bears are testing the 10-day SMA support, where another support line at 0.8700 converges, where there is a stronger support.

However, if the support zone is broken, we will likely see a further correction move.

The daily RSI indicator is heading downward from 70, suggesting waned bullish momentum.

The resistance level is at 0.8750, followed by 0.8800.

The support line is at 0.8700, followed by 0.8660.

The UK general election will be held on June 8th, which is only 3 days away. Be aware that GBP crosses will likely to be volatile before and after the release of the election outcome.

USD/CHF - 0.9652

Original strategy :

Sell at 0.9685, Target: 0.9585, Stop: 0.9720

Position : -

Target :  -

Stop : -

New strategy  :

Sell at 0.9685, Target: 0.9585, Stop: 0.9720

Position : -

Target :  -

Stop : -

Dollar’s recovery after marginal fall to 0.9622 suggests minor consolidation would be seen and corrective bounce to the Kijun-Sen (now at 0.9671) cannot be ruled out, however, reckon upside would be limited to 0.9685-90 and bring another decline later, below said support at 0.9622 would extend recent decline to 0.9600-05 (50% projection of 1.0100-0.9692 measuring from 0.9808) but oversold condition should limit downside to 0.9570 and price should stay well above support at 0.9550, bring rebound later.

In view of this, we are looking to sell dollar on recovery as 0.9685-90 should limit upside. Only break of resistance at 0.9720 would abort and signal a temporary low is formed instead, bring a stronger rebound to 0.9750 and then 0.9770 but price should falter below resistance at 0.9808.

GBP/USD - 1.2899

New strategy  :

Stand aside

Position : -

Target :  -

Stop : -

As sterling has remained confined within recent established range, retaining our view that further consolidation below indicated resistance at 1.2921 would be seen and weakness to 1.2845-46 (current level of the lower Kumo and Friday’s low) cannot be ruled out, however, break of 1.2830 support is needed to signal the rebound from 1.2769 has ended, bring further fall to 1.2800 but said support at 1.2769 should remain intact.

On the upside, above 1.2905 would bring another test of 1.2921-26 (resistance and previous support), however, break there is needed to signal low has been formed at 1.2769, bring further gain to 1.2940-45 (61.8% Fibonacci retracement of 1.3048-1.2769) and later towards 1.2970 but overbought condition should cap upside below 1.3000. As near term outlook is mixed, would be prudent to stand aside for now.

The French stock market has ticked lower in the Monday session, and the CAC index has dropped 0.68 percent. Currently, the CAC is trading at 5,307.80 points. On the release front, there was mixed news from the services sector, as French and Eurozone PMIs continue to point to expansion. French Services PMI improved to 57.2, but this missed the estimate of 58.0 points. Eurozone Services PMI edged lower to 56.3, above the forecast of 56.2 points. On Tuesday, the Eurozone releases Sentix Investor Confidence and Retail Sales.

It was a quiet week for the French stock markets, but that could change, with French voters going back to the polls on June 11. In two rounds of voting, the French electorate will choose the 577 members of the National Assembly. French President Emmanuel Macron's LREM party is on track to win the first round, with the latest polls giving Macron's party 31 percent of the vote, well ahead of the conservative Republicans, who are at just 22 percent. If Macron can translate this lead into a strong showing in the second round, the LREM could form a majority in parliament, which would mark a major victory for Macron.

The US labor markets has been performing well, so the markets were all the more surprised at the dismal Nonfarm Payroll report, which was released on Friday. The economy produced just 131 thousand jobs in May, well short of the forecast of 181 thousand. Wage growth remains soft, and edged down from 0.3% to 0.2%. The unemployment rate dropped to 4.3%, but this reading can be largely explained by a decline in the participation rate. The disappointing employment reports are unlikely to alter the Fed's plan to raise rates next week, but policymakers remain cautious, and if upcoming data misses expectations, additional rate hikes could be in jeopardy.

Despite some disappointing US job numbers, the odds of a rate hike have climbed to 96%, according to the CME Group, up from 88% just a week ago. Traders should note that ahead of the March hike, the odds of a rate hike were also close to 100%, and the dollar actually lost ground after the Fed followed through with a quarter-point increase. Although an increase in interest rates would mark a vote of confidence in the US economy, the Fed continues to have its concerns. Inflation remains stubbornly low, despite a labor market that remains close to capacity. Fed policy makers are also scratching their heads over soft consumer spending, which has not kept pace with high levels of consumer confidence. As for additional rate hikes in the second half of 2017, the markets are skeptical, with the odds of a September rate hike at just 26%.

EUR/USD - 1.1240

Original strategy  :

Bought at 1.1205, Target: 1.1305, Stop: 1.1235

Position : - Long at 1.1205

Target :  - 1.1305

Stop : - 1.1235

New strategy  :

Hold long entered at 1.1205, Target: 1.1305, Stop: 1.1235

Position : - Long at 1.1205

Target :  - 1.1305

Stop : - 1.1235

As euro has eased after marginal rise to 1.1285, suggesting minor consolidation below this level would be seen, however, reckon 1.1235-40 would contain downside and bring another rise later, above said resistance at 1.1285 would extend recent upmove to another previous chart resistance at 1.1300, break there would encourage for headway to 1.1340-45 but overbought condition should limit upside to chart point at 1.1366.

In view of this, we are holding on to our long position entered at 1.1205. Only below support at 1.1202 would abort and signal top is formed instead, risk weakness towards indicated support at 1.1164, once this level is penetrated, this would signal recent upmove has ended, bring further fall to 1.1130-40 first. 

USD/JPY - 110.62

Original strategy  :

Sell at 111.00, Target: 110.00, Stop: 111.35

Position :  -

Target :  -

Stop : -

New strategy  :

Sell at 111.00, Target: 110.00, Stop: 111.35

Position :  -

Target :  -

Stop : -

As the greenback has recovered after marginal fall to 110.31, suggesting consolidation above this level would be seen and corrective bounce to 110.80 cannot be ruled out, however, reckon the Kijun-Sen (now at 110.99) would limit upside and bring another decline later, below said support at 110.31 would extend recent decline to previous support at 110.24 but break there is needed to provide confirmation that early selloff from 114.37 top has resumed for weakness to 109.90-00 first.

In view of this, would not chase this fall here and would be prudent to sell dollar on recovery as 111.00 should limit upside. Only above the upper Kumo (now at 111.41) would abort and signal low is formed, bring another bounce towards Friday’s high of 111.71.

Daily Pivots: (S1) 1.1229; (P) 1.1256 (R1) 1.1308; More....

Intraday bias in EUR/USD remains on the upside for 1.1298 resistance. Decisive break there will carry larger bullish implication and target 1.1615 resistance next. Near term outlook will now remain bullish as long as 1.1109 support holds. Nonetheless, we'd stay cautious on rejection from 1.1245/98 (138.2% projection of 1.0339 to 1.0828 from 1.0569 at 1.1245) resistance zone. Break of 1.1109 will indicate short term topping and turn bias back to the downside.

In the bigger picture, the case for medium term reversal continues to build up with EUR/USD staying far above 55 week EMA (now at 1.0888). Also, bullish convergence condition is seen in weekly MACD. Focus will now be on 1.1298 key resistance. Rejection from there will maintain medium term bearishness and would extend the whole down trend from 1.6039 (2008 high). However, firm break of 1.1298 will indicate reversal. In such case, further rally would be seen back to 1.2042 support turned resistance next.

Daily Pivots: (S1) 0.9587; (P) 0.9652; (R1) 0.9686; More.....

Intraday bias in USD/CHF remains on the downside for the moment. Deeper decline could be seen through 100% projection of 1.0342 to 0.9860 from 1.0099 at 0.9617. But we'd start to look for bottoming signal again as it approaches 0.9443 key support level. On the upside, above 0.9718 minor resistance will turn intraday bias neutral first. But near term outlook will stay bearish as long as 0.9807 resistance holds.

In the bigger picture, USD/CHF is still bounded in medium term range of 0.9443/1.0342 for the moment. Consolidative trading would likely continue and medium term outlook remains neutral. Break of 1.0342 key resistance is needed to confirm underlying bullish momentum in the pair. Meanwhile, downside attempts should be contained by 0.9443 key support level. However, sustained break of 0.9443 will carry larger bearish implication and target 0.9 handle.

Daily Pivots: (S1) 109.93; (P) 110.81; (R1) 111.31; More...

Intraday bias in USD/JPY remains neutral cautiously on the downside with focus on 110.23 support. Break there will resume the decline from 114.36. In such case, deeper fall should be seen to 108.12 and below. Whole decline from 118.65 is seen as a correction and is still in progress. We'll look for bottoming signal at 61.8% retracement of 98.97 to 118.65 at 106.48 as the correction extends. Meanwhile, above 111.70 will turn intraday bias back to the upside. But we'd expect strong resistance from 61.8% retracement of 114.36 to 110.23 at 112.78 to limit upside and bring fall resumption.

In the bigger picture, price actions from 125.85 high are seen as a corrective pattern. It's uncertain whether it's completed yet. But in case of another fall, downside should be contained by 61.8% retracement of 75.56 to 125.85 at 94.77 to bring rebound. Overall, rise from 75.56 is still expected to resume later after the correction from 125.85 completes.