G10
EUR – Price action remains heavy having completed a series of six lower highs now. Support around 1.2890 is the next region to overcome and this should open a move to 1.2830 which is the 200dma and the 61.8% fib from 1.2626-1.3172 move. Holding a core short and adding on rallies has been working so far this week, the order book has stops from 1.2940-60 with the downside surprisingly light. We have been better sellers of EUR and EURxxx in recent sessions for a range of accounts. Support 1.2890 and 1.2830, Resistance 1.2954 and 1.3003. Good luck.
GBP – Same story as the last few sessions, EURGBP supply is keeping GBPUSD bid above 1.62. I bought into the dip in GBPUSD yesterday but have already reduced the position and rotated the balance into a EURGBP short. We are back below the 100dma in EURGBP having seen some good supply in the overnight session, I expect the downtrend to remain in place and adding on rallies continues to work. There is a change to the shape of the order book with EURGBP scattered demand between .7940-.7900, clearly the topside selling interest we have had in recent sessions has gone to market. GBPUSD remains a little out of focus for now and the order book reflects this, GDP on Thursday still the main event risk. Levels to note GBPUSD support 1.6182 and 1.6164 Resistance 1.6250 and 1.6309, EURGBP support .7925-10 and .7887, Resistance .7965 and .8012. Good luck
JPY – Pressure remains on the downside with further liquation of post BOJ longs. xxxJPY selling will cap any topside recovery for now, in USDJPY a move back above 78.28 will be needed to neutralise the selling momentum. I plan to buy a dip around 77.50 with the post FOMC low of 77.13 a clear line in the sand, the main flow overnight was supply of EURJPY from Japanese exporters. The order book is now much better bid in USDJPY between 77.50-77.00. Good luck.
AUD (1.0426) – another very quiet session o/night, the absence of domestic data certainly not helping the cause. I am struggling to see a major catalyst today that will change proceedings, as such am looking for 1.0465-70 to cap any moves to the topside. Books harbour a slight skew to sell above, with nothing below until we hit a pocket of stops in the 1.0380-60 region. 23.6% fib level from June lows —> recent highs comes in at 1.0379, below here and it opens up for a few big figures in my opinion. G’luck!!
CAD – We churned through some big offers in USDCAD above 0.9800 on the way up to 0.9820 yesterday with some decent selling of EURUSD below 1.2920 going through. Still should be corp interest to sell funds ahead of 0.9850 which I think is still the short term sell zone but the USD does feel very bid at the start of this week. CA retail sales and US consumer confidence to get the teeth into this afternoon and square in funds but will keep trying to sell the rally back to 0.9850 with a 0.9900 chop. Good luck.
Resistance 0.9820 0.9850 0.9900
Support 0.9750 0.9680 0.9650
Scandies – A range bound session in scandies yesterday and the important levels and strategy remain in tact. EURSEK has bids down to 8.45/46 with stops below and there is still an interest to sell back to 8.55/56 and certainly ahead of major resistance around 8.65. Sitting core long NOKSEK looking for move back to 1.16 and will add back to 1.14 with a stop below 1.1350. Swedish PPI this morning only data of note. EURNOK struggling for inspiration, I like NOK to continue to perform well and happy to express this purely in NOKSEK, if EURNOK drifts back towards 7.45/46 will look to sell straight EURNOK. Good luck.
EURSEK support: 8.45 8.42 8.38 resistance: 8.56 8.60 8.65
EURNOK support: 7.40 7.38 7.30 resistance: 7.48 7.50 7.55
EM
ZAR – Stepping back into the office after the long weekend sees USD bid across the board as poor German IFO numbers yesterday spurred some USD demand. ZAR is holding up well considering the risk selloff and it will be interesting to see how the local market reacts this morning once liquidity gets back to normal levels. With EURUSD continuing to grind lower I think it’s worth staying long some USDZAR and on the day we’ll look for dips towards 8.2200 to go long the pair, aiming for a move towards 8.3500. On the data front we have Leading Indicators locally and Consumers confidence numbers out of the States.
Barclays Capital