Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY
EUR/USD: Neutral: Downward pressure has eased, in a 1.0580/1.0750 range.
While we indicated yesterday that the pull-back from the 1.0825/30 high two weeks ago is trying to form a base, the rapid rise that easily took out the strong 1.0640 resistance came as a surprise (overnight high of 1.0680). Downward pressure has clearly eased and the current movement is viewed as the early stages of a consolidation phase. That said, the immediate bias is for a probe higher towards the top-end of the expected 1.0580/1.0750 consolidation range.
GBP/USD: Neutral: Still in a range, likely within 1.2350/1.2600.
We have maintained a neutral GBP stance since the start of the month and the subsequent price action has been in line with our expectation. Trading has been choppy and directionless and at this stage, there is no pre-indication that a ‘break-out’ of the expected 1.2350/1.2600 consolidation range is imminent.
AUD/USD: Bullish: To take half profit at 0.7775/80.
While AUD made a fresh high of 0.7732 yesterday, the sharp pull-back from the top coupled with the weak daily closing has dented the upward momentum. That said, as long as 0.7640 is intact, we continue to anticipate a move towards the late November high of 0.7775/80 (even though the odds for such a move have diminished). Those who are long should look to book half profit at 0.7775/80.
NZD/USD: Neutral: In a 0.7150/0.7320 range. [No change in view]
The move back above 0.7220 indicates that the pull-back last week’s 0.7375 peak has found a temporary low at 0.7135 two days (see anointed chart below). NZD has likely moved into a consolidation range and is expected to trade sideways for now, likely between 0.7150 and 0.7320.
USD/JPY: Neutral: In a 112.30/114.50 range.
The up-move from the 111.55/60 low last week has likely found a temporary top at 114.95 two days ago. From here, USD is deemed to have moved into a consolidation phase and is expected to trade between 112.30 and 114.50.