Forex Charts
FX Daily
We expect the Fed to cut its monthly bond purchases by an additional USD10bn in connection with today’s meeting and hence stick to its unofficial plan for tapering.
FX Daily
Focus will be on emerging markets where one of the important battle lines so far has been Turkey’s attempt to stabilise its currency.
USDJPY – successfully holds 102.21/101.77 support zone (so far)
The bearish trend change and rounded top in Yen have raised concern regarding our call for another marginal high in prices. Still the longer-term wave count implies an incomplete rally and
USDCAD – correcting wave-(3) rally; pullback targeting 1.0885/0798
rally from the September low. A correction is now in order that will continue the weakness seen since Thursday’s bearish reversal candle. Two clusters of Fibonacci retracement support surface at 1.0885 and
EURUSD – wave-(2) correction reaches extension target & pivot resistance
Because of major weekly resistance and the bearish reversal below 1.39 we have been biased to the downside in Euro and last week prices failed right where old pivot lows and
FX Daily
Market focus will remain on the development in emerging markets. At this stage we do not expect the emerging market wobbles to be enough to prevent Fed to continue tapering in connection with the FOMC meeting on Wednesday.
USDJPY – 102.21/101.77 support zone is critical to wave-(4) outlook
There is a rounded top in JPY and trends have turned down but this area just above 102 represents a critical support area and could mark the completion of wave-(4) ahead of one more push to marginal new highs.
FX Daily
In terms of data releases we have a very thin calendar today but there are some interesting events. A potential rating decision from Moody’s on France’s sovereign rating might attract some attention.
USDCAD – small pullback can set stage for ~1.12 symmetry target
Momentum in $CAD is at extremes which supports the idea that we are completing a larger degree wave-(3) rally.
FX Daily
The main release will be euro PMI in January. Manufacturing PMI is likely to move broadly sideways after having been on an upward trend since April 2013.
USDJPY – small bull triangle ahead of rally towards ~105.50 area
Since the rally from 102.86, prices have been forming a bull triangle above our key 103.89 support level. Further back and forth is needed to satisfy the consolidation ahead of an expected rally to near ~105.50.
GBPUSD – A-B-C pullback and false trendline break suggest new highs
There was a false trendline break just above key 1.6260 support; the rally since suggests a new high ahead for Sterling with extension targets as high as 1.6711.