Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY
EUR/USD: Neutral: Break below 1.0600 could not be ruled out just yet.
EUR eked out another fresh low of 1.0427 but this time round, the rebound and the subsequent daily closing was markedly weaker. As indicated yesterday, despite waning downward momentum, another push lower could not be ruled out just yet. From here, only a move back above 1.0700 would indicate that a short-term low in place. On the downside, the rising trend-line support has edged higher to 1.0600 (from 1.0595) and a ‘clean’ break of this level could lead to a rapid drop to 1.0525/30 (odds for such a move appears to be slightly less than even).
GBP/USD: Neutral: In a 1.2350/1.2580 range.
There is not much to add as GBP continues to trade mostly sideways. We continue to hold the view that the current movement is part of a broad 1.2350/1.2580 consolidation range.
AUD/USD: Neutral: Below 0.7490 opens up way for 0.7450.
We have held the same view since Wednesday where in we expect the current AUD weakness to extend lower to 0.7490. The lackluster downward momentum has picked up strongly and the odds for a sustained break below 0.7490 are higher than we previously expected. A break of this level could lead to acceleration lower as the next support Is further down at 0.7450 (major support is at 0.7400). In order to maintain the current momentum, any rebound should not move back above 0.7610 even though 0.7585 is likely strong enough to cap any short-term rebound.
NZD/USD: Neutral: A sustained move below 0.6950 is unlikely.
NZD traded in a narrow range yesterday and the key short term resistance at 0.7020 is still intact (high of 0.6989). NZD has to move above 0.7020 to indicate that the immediate downward pressure has eased. Until then, another push lower is not ruled out but the odds for a sustained drop below 0.6950 are not high (next support is at 0.6900).
USD/JPY: Neutral: Increasing risk of a break below 110.00.
As indicated yesterday, the downside still appears to be more vulnerable even though we do not attach high odds for a break below 110.00. At the time of writing, USD dropped sharply after US announced missile attack on Syria and the risk has shifted quickly to the downside. This pair is expected to stay under pressure unless it can reclaim 111.00 in the next few days. A drop below 110.00 would open up the way for a move to 109.60, possibly 109.10.