Tag: EURUSD

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DAX and Euro bearish

The Euro encountered resistance at $1.38 and is again testing the new support level of $1.37 on the weekly chart. Bearish divergence on 13-week Twiggs Momentum warns of trend weakness, but only reversal below zero would indicate a primary trend reversal. Breach of primary support at $1.35 would signal a down-trend, while breakout above $1.38 would offer a target of $1.43*.

Euro

* Target calculation: 1.38 + ( 1.38 – 1.33 ) = 1.43

Germany’s DAX paints a similar picture to the Euro, with bearish divergence on 13-week Twiggs Money Flow suggesting sellers at 10,000. Retreat below 9600 would warn of another test of primary support at 9000.

DAX

DAX Volatility below 20, however, continues to suggest low risk typical of a bull market.

DAX

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Euro Sterling rally

The euro respected primary support at $1.32. Recovery above $1.36 would signal another attempt at $1.42. But the primary trend, as indicated by 63-day Twiggs Momentum below zero, is downward and breakout below $1.32 would signal a decline to $1.22*.

EURUSD

* Target calculation: 1.32 – ( 1.42 – 1.32 ) = 1.22

The Pound also rallied but again 63-day Twiggs Momentum is weak. Follow-through above $1.57 would suggest another attempt at $1.615. But the primary trend remains downward and failure of primary support at $1.53 is more likely, offering a target of $1.45*.

GBPUSD

* Target calculation: 1.53 – ( 1.61 – 1.53 ) = 1.45

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Euro approaches key support

The euro is headed for a test of primary support at $1.32.  The peak below zero on 63-day Twiggs Momentum indicates a strong primary down-trend. Failure of support would offer a target of $1.22*.

EURUSD

* Target calculation: 1.32 – ( 1.42 – 1.32 ) = 1.22

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Here’s One Reason the Euro Hasn’t Gotten Crushed. Yet. – WSJ

[Jens Nordvig at Nomura] estimates suggest that $100-125bn may have been repatriated by Eurozone equity portfolio investors in Aug-Oct.

This is an outsized figure, and may have helped avoid a much bigger decline in EURUSD since August.

Looking ahead, we are skeptical that this repatriation flow will continue to provide strong support for the Euro.

via Here’s One Reason the Euro Hasn’t Gotten Crushed. Yet. – MarketBeat – WSJ.

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Euro sinks, dragging sterling lower

EURUSD broke through $1.36 warning of another test of primary support at $1.32. Respect of the zero line by 63-day Twiggs Momentum confirms a primary down-trend. Failure of support would offer a target of $1.22*.

EURUSD

* Target calculation: 1.32 – ( 1.42 – 1.32 ) = 1.22

GBPUSD is being dragged lower by the euro. Reversal below $1.60 warns of another test of primary support at $1.53 — as does 63-day Twiggs Momentum respect of the zero line.  Failure of support would offer a target of $1.46*.

GBPUSD

* Target calculation: 1.53 – ( 1.60 – 1.53 ) = 1.46

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Euro falters upset sterling

The euro retreated below $1.40 and is now consolidating at $1.36. Failure of medium-term support would test the primary level at $1.32. In the long-term, breach of $1.32 (if the Greeks vote “No”) would offer a target of $1.22*. 63-Day Twiggs Momentum holding below the zero line suggests continuation of the primary down-trend.

EURUSD

* Target calculation: 1.32 – (1.42 – 1.32 ) = 1.22

63-Day Twiggs Momentum similarly suggests continuation of the primary down-trend for the Pound. Breach of primary support at $1.53 would confirm, offering a target of $1.46*.

GBPUSD

* Target calculation: 1.53 – ( 1.60 – 1.53 ) = 1.46

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Forex: Euro and the Aussie dollar strengthen

The euro is testing resistance at the former support level of $1.40, in the hope that the bailout out-lined today will rescue the euro-zone from its debt crisis. We will probably read fairly disparate views over the next few weeks before the varying viewpoints synthesize into a clear market direction. Reversal below $1.365 would warn of a decline to $.20*, while narrow consolidation below the resistance level would suggest a breakout and advance to the 2011 highs.

EURUSD

* Target calculation: 1.30 – ( 1.40 – 1.30 ) = 1.20

The Pound similarly rallied to $1.60. Respect would re-test primary support at $1.53, while breakout would target $1.67.

GBPUSD

* Target calculation: 1.53 – ( 1.60 – 1.53 ) = 1.46

The dollar broke support at ¥76, continuing its long-term (mega) down-trend against the Yen.  Target for the breakout is ¥72*.

USDJPY

* Target calculation: 76 – ( 80 – 76 ) = 72

The Aussie benefited from the weaker greenback, recovering above $1.04 to signal an attempt at $1.08*. Penetration of the descending trendline indicates that the down-trend is weakening.

AUDUSD

* Target calculation: 1.04 + ( 1.04 – 1.00 ) = 1.08

The Aussie and Loonie both closely follow commodity prices. Respect of the upper trend channel on the CRB Index would warn of another down-swing.
CRB Commodities Index
Canda’s Loonie is testing resistance at $1.00 against the greenback. Reversal below $0.975 would warn of another down-swing, while breakout above parity would target $1.02*.

CADUSD

* Target calculation: 1.00 + ( 1.00 – 0.98 ) = 1.02

The Aussie dollar completed a double bottom against its Kiwi counterpart (probably due to lost man-hours after celebrating their Rugby World Cup win). Expect a test of $1.32* followed by retracement to confirm support at $1.28.

AUDNZD

* Target calculation: 1.28 + ( 1.28 – 1.24 ) = 1.32

The South Africans went home early (from the RWC) and a descending triangle on the USDZAR warns of  downward breakout to test support at $7.20.

USDZAR

* Target calculation: 7.80 – ( 8.40 – 7.80 ) = 7.20

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Forex overview

The euro is consolidating above $1.365; failure of support would re-test $1.315, warning of another primary decline. A 63-day Twiggs Momentum peak below the zero line would confirm a strong primary down-trend.

EURUSD

* Target calculation: 1.32 – ( 1.40 – 1.32 ) = 1.24

The pound retraced to test resistance at $1.59/1.60 on the weekly chart. Declining 63-day Twiggs Momentum, below zero, suggests a strong down-trend. Reversal below $1.53 would offer a target of $1.46*.

GBPUSD

* Target calculation: 1.53 – ( 1.60 – 1.53 ) = 1.46

Canada’s Loonie resembles the Aussie dollar: reversal below short-term support at $0.975 would test $0.94. Respect of the descending trendline would also warn of a decline to $0.88*.

CADUSD

* Target calculation: 0.94 – ( 1.00 – 0.94 ) = 0.88

The Aussie dollar is testing support at $1.28 against its Kiwi counterpart after completing a double bottom. Respect of support would confirm the target of $1.32*.

AUDNZD

* Target calculation: 1.28 + ( 1.28 – 1.24 ) = 1.32

The greenback is ranging in a narrow band above ¥76, supported by the Bank of Japan. 63-Day Twiggs Momentum holding below zero confirms the strong down-trend.

USDJPY

The greenback recovered above R8.00 on the weekly chart against the South African Rand. Expect another test of R8.50. Upward breakout would warn of an accelerating up-trend that is likely to lead to a blow-off.

USDZAR

* Target calculation: 8.50 + ( 8.50 – 7.70 ) = 9.30

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Euro rallies on hope of bank rescue

The euro is headed for a test of $1.40 against the greenback, on the hope that European banks will be re-capitalized after taking a haircut on the PIIGS bonds. There still appears to be some confusion — I suspect deliberate — as to who will pay, with German Finance Minister Wolfgang Schaeuble suggesting that banks first attempt to raise money from investors. Given the current state of financial markets, private investment will be scarce and European taxpayers are likely to end up with sizable stakes in a number of banks. Expect resistance at $1.40 to be followed by another test of support at $1.30*.

EURUSD

* Target calculation: 1.40 – ( 1.50 – 1.40 ) = 1.30

The pound is similarly headed for resistance at $1.60. Respect would signal another test of $1.53.

GBPUSD

* Target calculation: 1.53 – ( 1.60 – 1.53 ) = 1.46

Canada’s Loonie and the Aussie dollar both benefited from a surge in commodity prices. Expect the CADUSD to find resistance at parity, followed by another test of support at $0.94.

CADUSD

* Target calculation: 1.00 – ( 1.06 – 1.00 ) = 0.94

The Aussie will find resistance between $1.02 and the descending trendline. Respect is likely and would indicate another test of $0.94.

AUDUSD

* Target calculation: 1.02 – ( 1.10 – 1.02 ) = 0.94

The Aussie has formed a broad double bottom against its Kiwi counterpart. AUDNZD breakout above $1.28 would signal a primary advance to $1.32*.

AUDNZD

* Target calculation: 1.28 + ( 1.28 – 1.24 ) = 1.32

Support is holding firm on the dollar-yen cross — with assistance no doubt from the BOJ. Expect a narrow range between 76 and 78.

USDJPY

The South African rand is testing support at R7.70 against the greenback, after penetrating its rising trendline. Probably because of all the visitors returning early from the Rugby World Cup. 🙂 Apparently they have invited the referee to run a series of clinics in South Africa on his novel interpretation of the forward-pass rule. I suggest that he decline — it could get violent. Failure of support would offer a target of R7.00*

USDZAR

* Target calculation: 7.70 – ( 8.40 – 7.70 ) = 7.00

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Pound joins Euro slide

Apologies. I messed up the links at the bottom of the Trading Diary newsletter. For the correct link click here. Correct links are also available on the Trading Diary web page and under Recent Posts in the right margin of this page.

The euro retraced to test resistance at $1.34 but is likely to continue in its downward trend channel. Reversal below $1.3150 would test our target of $1.30*. 63-Day Momentum declining below zero confirms the primary down-trend.

EURUSD

* Target calculation: 1.40 – ( 1.50 – 1.40 ) = 1.30

The pound has been dragged lower by the euro-zone crisis. Breach of support at $1.53 would offer a target of the 2010 low at $1.43.

GBPUSD

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