Daily Market Technicals

The close above the 21-DMA is the first since mid-July and may prove to be a game changer. Bears now need a close back below the 21-DMA to negate Wednesday’s sharp bounce and shift immediate focus back to the $1.2501-1.2605 region with overall focus returning to the $1.2042-1.2241 region. While the 21-DMA supports bulls now retain the upper hand and initially target $1.2995-1.3007 where the 55-DMA and falling daily trend line are located.

RES 4: $1.2995 High Sept 16

RES 3: $1.2959 38.2% Fibonacci $1.3701-1.2501

RES 2: $1.2927 Bollinger band top

RES 1: $1.2902 High Sept 23

LPRICE: $1.2818

SUP 1: $1.2741 Hourly support Oct 15

SUP 2: $1.2724 21-DMA

SUP 3: $1.2605 Low Oct 10

SUP 4: $1.2501 2014 Low Oct 3

The bounce from fresh 2014 and 11 month lows Wednesday was unable to gain traction above the $1.6050 level with bears regaining the upper hand and cable looking heavy heading into European trading. Bulls now need a close above $1.6069 to ease bearish pressure whereas a close above the 21-DMA remains needed to hint at a bigger bounce that would see bulls targeting the $1.5636 level. While $1.6069 caps bears remain focused on the $1.5425-1.5556 region.

After hesitating at the Bollinger band base Monday and Tuesday USD/JPY headed sharply lower Wednesday, dipping below the 55-DMA for the first time since early August. Initial resistance is now noted at ¥106.67 with bulls needing a close above to ease the current bearish pressure. The 55-DMA has supported in Asia so far today but while ¥106.67 caps immediate bearish focus remains on the ¥104.04-68 region with the 100-DMA noted at ¥104.04. Key concerns for bears come from O/S studies and the Bollinger band base.

Bulls take a little comfort in the bounce from recent 2014 lows when combined with the O/S daily studies overdue a correction. In saying that, bulls continue to look for a close above ¥136.59 to ease bearish pressure. Overall a close above ¥137.97 is now needed to confirm a break of the 100-DMA and shift focus to the 200-DMA (¥139.29) and then the Sept highs. While ¥136.59 caps bears remains focused on the ¥134.10 level.

After a brief flirtation with the 100-DMA EUR/GBP raced higher Wednesday with immediate focus now shifting to the £0.8067 Sept monthly high. Layers of support have accumulated with bears needing a close below £0.8004 to ease bullish pressure a little and below the 100-DMA to hint at deeper correction targeting the £0.7867-00 region where the 21-DMA is located. Key concerns for bulls come from O/B daily studies and the Bollinger band tops.