EUR/USD and G10: Levels, Ranges, Targets

When Mark Carney left the Bank of Canada to head the BOE, GBP/CAD became known as the “Carney Cross” and yesterday it performed to its designation.

GBP/CAD from last Friday, April 13th, achieved its destination overnight at target 1.7772 and now exit at 1.7782. Massive resistance faces GBP/CAD at 1.7700’s. The next big break point is located at 1.7705 then 1.7698 and 1.7611. Overall range is located from 1.8037 to 1.7705.

AUD/NZD despite big drops in AUD/USD and NZD/USD as well as both trading below vital break points, AUD/NZD sits dead and the 5 week range traded 188 pips from 1.0485 to 1.0673 . After 5 weeks and a 188 pip range, AUD/NZD is best described as a severe underperformer currency pair. Editorially, AUD/NZD is permanently excluded from trade consideration as other trade able currency pairs exist. A 188 pip range equates to 7.52 pips per day in 25 trade days.

USD/HKD, despite HKMA intervention last week, USD/HKD dropped 100 pips and against severe skyrocket overbought. Asia contains 2 most vital money market centers, Singapore and Hong Kong. The Chinese deal through Hong Kong in offshore USD/CNY and Onshore USD/CNH while the Japanese and most Asia nations deal through Singapore. Both USD/HKD and USD/SGD then remain quite stable in prices and movements. USD/SGD rose 36 pips in 2 days.

GBP/USD. Monday represents the finalization to the BOE’s 2 year interest rate revamp study . Release times will change as priority is devoted to separate wild news movements to a smoother traded currency price. Far more direction and control to GBP is granted to banks and interest rate traders as the prior BOE’s interactive system for interest rate look up was also revamped.

The BOE’s prior interactive system required advanced knowledge to trade GBP against interest rates. Now, the BOE forced interest rate traders to build their own interest rate curves and only those banks with prior interest rate knowledge contain this deep expertise as they deeply understand the interest rate changes.

One vital aspect to the change is the BOE created a sincere nightmare hurdle to obtain the necessary interest rates and only few banks are willing to take this time and to factor the curves. As I’m inside every nation’s interest rate system daily over many years, GBP from my perspective is still able to trade based on the BOE’s new system but how effective will the changes hold and can the BOE actually contain GBP volatility is questionable and only time will tell the tale.

EUR/USD look at 1.2309 and 1.2293 to hold then bounce today. Break point for much lower is now located at 1.2252 and a rising line.

EUR/CAD remains the only pair left from the 5 week trades and short is our trade. Watch EUR/CAD bounce today from 1.5558 and 1.5576 and 1.5579 to 1.5606 and 1.5621. Top of today’s channel is 1.5713 and excellent sell area.

AUD/USD is contained from 0.7669 to 0.7677. AUD price is deeply low and oversold and break point is now 0.7769. AUD will be reviewed after the close today for possible new upside target from 0.7836.

NZD/USD remains below its break point at 0.7260. EUR/NZD is again playing around its vital 1.7088.

USD/JPY break is located today 108.04. Upse target today located at 107.93 on break of 107.82.

EUR/AUD is again trading in the 1.6000’s, short is the way.

USD/PLN traded yesterday to its next break point above 1.3719 to 1.3816. Watch 1.4023 break, its close.

GBP/USD is close to its most vital break point at 1.3969. A break then much lower for GBP. Look for 1.3991 and 1.4007 to contain GBP today. Higher must break 1.4072 then 1.4097.

GBP/JPY big line break is located just below at 150.86. At 151.33 and 151.10 must hold or 150.86 becomes vulnerable to a break lower.

USD/CAD trades below most vital break at 1.2674 inside a small range from 1.2641 to 1.2674.

 

Brian Twomey

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EUR/USD and G10: Levels, Ranges, Targets

AUD/USD traded to 0.7812 and 4 week target remains 0.7836. AUD/JPY from mentioned RBA long at 83.06 and target 83.75 traded to 83.94 for an 88 pip gain although as stated the trade failed to meet the continued now 5 week + 100 pip trade criteria. Watch AUD/JPY 84.29.

The educational note in 35+ currency pairs traded and + 3,000 pip achieved targets is other market prices were completely irrelevant. Other market prices are and will remain irrelevant. CAD and OIL for example is not the way to trade or view CAD as every currency pair price trades on their own and fails to need assistance from another price in any market instrument.

Overall point to note in our currency pairs is while close to + 100 pips targets, currency prices failed to trade to 100 pips or better. USD/CAD traded 105 pips as well as EUR/CAD and GBP/CAD. What CAD offered was shorts. What the overall G 10 market offered as mentioned was barely 100 and 150 pip ranges.

GBP/CAD held below 1.8038 and offered another short for interested. EUR/CAD offers another short and view breaks at 1.5541 and 1.5526 for shorts to gain down speed to 1.5470’s then below to 1.5300’s GBP/CAD remains for target at low 1.7800’s to high 1.7700’s.

USD/CAD shorts below 1.2575 and 1.2647. CAD direction as mentioned remains short.

EUR/CAD twice achieved + 80 pips on the shorts but for ulterior motives I remain and will remain short. The overall EUR/CAD question is how strange and to what degree does strangeness achieve. EUR/CAD remains literally exorbitantly overbought.

AUD/NZD’s 4 week and miserable trade ended and as mentioned exit was taken at 1.0668 for + 70 ish pips and just ahead of its vital break point at 1.0700’s. A break higher at 1.0700 than AUD/NZD higher. Overall AUD/NZD will eventually trade to 1.0900’s but patience required.

Encouragement to learn and trade USD/PLN as PLN is and always was a terrific currency pair. On paper, PLN appears a monster currency pair but its not as it trades smooth and responds to targets perfectly. Entry at 3.3630 achieved +80 pip overnight target at 1.3719.

EUR/JPY watch 133.11, it held yesterday at 132.90 and today’s high at 133.09. Massive resistance exists at 133.30 and 133.33. Short only is the way above 133.11. A Forex God, market gift exists for EUR/JPY to trade to 134’s, 135’s.

Ongoing trades remain only in short EUR/CAD and GBP/CAD. GBP/CAD was the only non perfect trade as entry was off but chances to load shorts. AUD/NZD’s 4 week entry was slight off as well but it offered chances to load longs. Targets were known, prices informed to trade the price.

Again target first then allows to trade the price.

EUR/AUD from last month’s post and 1.5738 target from 1.6191 achieved 1.5776 lows and more downside exists.

From yesterday, GBP/JPY dead stopped at 152.09 and as mentioned GBP/JPY had to trade back to 152.76 and it traded to 152.68. GBP/USD mentioned had to trade back to 1.4233 from 1.4172 lows and it traded to 1.4246.

USD/JPY 2 weeks ago reported break point to travel higher at 107.85 and last week 107.95. Today 108.05 is the break point as 107.85 traveled higher as USD/JPY approached its break point.

EUR/USD dead stopped perfectly at our 1.2399, above then target to 1.2431. Bottom 1.2337 and 1.2321 will hold EUR from further downside today.

GBP/USD target today is located at 1.4264 on a break of 1.4231.

GBP/JPY target today is located at 153.23 on break of 152.87.

After 5 weeks and 35 + different currency pairs traded and + 3500 ish pips, the end is here once GBP/CAD and EUR/CAD completes targets.

Overall 1 month goal was trade 30 different currency pairs and + 3,000 pips. I surpassed the goal by many miles. Next possible is trade to targets up and down 3 and 5 curreny pairs.

Brian Twomey

 

USD/SGD and USD/PLN: Levels, Ranges, Targets

Current USD/SGD, Singapore Dollar trades at 1.3099 and is a great currency pair to hit targets as it trades steady as AUD/USD or NZD/USD. Current USD/SGD is oversold and trades at the bottom of its range.

Match Sing – Apore against MYR, the Malaysia Ringgit as SGD/MYR then the famously named Sing / Ring currency cross is created.

Bottom of the range means not only 1.3092 and 1.3087 but bottom of a multi year range. Long is the only direction as shorts are impossible. The big break point for longs to see USD/SGD higher is 1.3197 and a break targets many and massive resistance points at 1.3300’s starting at 1.3303 and up to the 5 and 10 year averages at 1.3357 and 1.3368.

Longs must trade to 1.3181 yet must cross above 1.3141, 1.3158, 1.3171 then 1.3184. Overall, higher in USD/SGD represents a correction as price remains below 1.3762 and 1.3606.

The long trade despite resistance and 50 ish pips involved is forced upon USD/SGD as it lacks ability to travel lower

Last post reported EUR/JPY top at 133.11, it held at 132.90. GBP/JPY dead stopped at 152.09 and as mentioned GBP/JPY had to trade back to 152.76 and it traded to 152.68. GBP/USD mentioned had to trade back to 1.4233 from 1.4172 lows and it traded to 1.4246.

To know a target price is to know how to trade a price and this is completed by either hold to target or trade multiple times in the direction of the target.

A far better long trade is USD/PLN from its current 1.3635 price. As in USD/SGD, the long in USD/PLN represents a correction higher as long as price remains below 3.3927 and 3.4213.

Above 3.4213 targets 3.4314, 3.4435, 3.4739 then wide open to 3.5069 and challenge to the 5 year average at 3.5471.

Target on the long is 1.3719 and just shy of the next vital break point at 3.3816. Overall, current range is located from 3.3535 to 3.3816.

Brian Twomey

GBP/JPY, NZD/JPY, MXN: Levels, Ranges, Targets

More pairs not in contention is GBP/AUD as this pair is stuck between 1.8699 to 1.8262 and currently trades at 1.8412. GBP/NZD shorts lack all consideration but rather its in buy drop mode especially at 1.9253 and 1.9188. EUR/NZD fully informs any long on drop strategies as price holds above 1.6848 and 1.6883 however 1.6910 becomes the target and above 1.6910 evolves into a short only scenario. EUR/NZD is set and ready to rise back to its last reported point at 1.7082 but this assumes NZD/USD falls much lower in correction mode.

CAD/ZAR dropped today to 9.5510 from 9.5602 yesterday for 92 pips and fully explains EUR/USD’s 1.2351 to 1.2397 range. CAD/ZAR lacks a big move as it ranges from most vital break points between 9.6368 to 9.4853. Longer term, CAD/ZAR trades beteen its 5 and 10 year averages from 10.1419 to 8.8829. CAD/ZAR informs EUR/USD will remain in range mode for a long time in the future.

Ongoing trades remain EUR/CAD, GBP/CAD and long held AUD/NZD. EUR/CAD achieved a +80 pip gain so far and remains a current short. Lower 1.7800’s, upper 1.7700’s for GBP/CAD then out while AUD/NZD requires a further AUD/USD correction then out near 1.0665. AUD/JPY from RBA’s 83.06 low trades 83.43 and heading to 83.75.

From JPY cross pairs, EUR/JPY 133.11 remains the top while CAD/JPY and AUD/JPY trade in slow grind mode.

GBP/JPY faces rough resistance at 153.23, 153.33 and 153.99 as the current upside move remains a large correction especially below 159.80 and 160.39. Above 153.99 then next comes 154.75 and not likely to be seen anytime soon as GBP/JPY drivers at 145.90 and 150.83 are far overbought. Sell rallies is the way forward overall.

Solid supports are located at 150.89 and 150.83. Overall GBP/JPY is a 310 pip range from 150.89 to 153.99 . GBP/JPY requires a correction to 152.27 but not much further as 151.04 remains the vital line to hold 150.89 and 150.83 from its break. Quick trade is the best GBP/JPY offers unless GBP/USD falls into correction mode. Look for quick longs at 151.04 to target again 152.27.

As of writing 152.29 achieved so long to 152.76 is the way today while GBP/USD trades back to 1.4233. Today is free trade day.

NZD/JPY must break for lower to target 77.87 is located at 78.79 and 78.49. Above 78.79 then 79.94 is in deck.

USD/MXN trades between 17.88 to its vital break point at 18.44 to then target above at 18.71, 18.77 and 18.88. Below 17.88 then next comes 16.81.

CAD/MXN next break above to target 14.62 and 14.79 is located at 14.54. Above 14.79 becomes a short only strategy as CAD/MXN trades at the top of its range.
Brian Twomey

USD/CAD V CAD/JPY: Levels, Ranges, Targets

Last month’s currency prices and pairs performed exceptional at 300 to 600 pip movements and this month either settled prices or certain currency pairs trade in slight correction mode. Slight so far is the operable word as it applies to USD/CAD, CAD/JPY, AUD/JPY. Slight was the market order suspected as the search continues for new trades. GBP/NZD is on deck as it rose almost 300 pips since Friday’s post and its about ready. Again, the criteria is +100 to 150 pip or more trades.

On the NAFTA front, its quite extraordinary to even see slight movements in USD/MXN and an utterly dead pair in CAD/MXN. So dead is CAD/MXN, it makes the analyst’s CAD/CHF look like a volatile pair. I might post the combo to define dead as it was suspected a NAFTA deal would reveal great trades. It doesn’t.

The Bank of Mexico learned the new central bank art of interest rate manipulation as TIE rates trade in utter dead zones. A once great and volatile pair in USD/MXN coupled with 1000’s of pip movement abilities now sadly trades like the EUR/USD and USD/JPY relationship.

Ongoing trades remain in AUD/NZD, EUR/CAD and GBP/CAD. AUD/USD is complete and review comes at 0.7836.
AUD/JPY on RBA dead stopped at previously reported 83.06 and offered trade at long 83.05 on RBA would target 83.75. The trade achieved + 27 so far. I remain not interested in AUD/JPY yet. I saw doves upon doves coming from the RBA and revealed through AUD/USD and AUD/JPY prices.

GBP/CAD Friday was a perfect trade set up and entry but positions traded 40 and 50 pips on either side of vital 1.8038. From a daily view, prices performed correctly. The trade remains ongoing but fails in consideration of success and its the 1st among 35 + trades. GBP/USD requires a correction as USD/CAD sits in dead ranges. A lose doesn’t exist in currency trading. At worst in any trade is break even.

As USD/CAD and CAD/JPY are offered, no interest in trade criteria exists at current prices.

USD/CAD trades between its vital break points from 1.2675 and 1.2521. Vital is 1.2521 because next comes 1.2357 then a good possibility for a run to the 5 year average at 1.2219.

Above, USD/CAD contains serious problems from 1.2540 to 1.2605 as this represents a deep dark gray area. At 1.2606 then 1.2648 is required to break to target the most important point 1.2685. The best achieved by a 1.2685 break is 1.2735 then solid at 1.2800.

USD/CAD’s best approach is in sell rally mode.

CAD/JPY longs remain good as long as prices remain above 85.15. The next upside target is 86.29 and 87.00’s are solidly blocked.

If 85.15 breaks then target is a good long point at 84.42. At 84.42 is an excellent long to target 85.15 and above.

CAD pairs as seen in USD/CAD, CAD/JPY, CAD/MXD and CAD/CHF trade in dead ranges. CAD dead ranges match AUD pairs and its suspected the same will be seen in NZD pairs. Next comes EUR and GBP and then possible Central Europe in PLN, INR.
Brian Twomey

 

EUR/USD V USD/JPY: Levels, Ranges, Targets

Week 8 and range compression continues the EUR/USD and USD/JPY story as EUR/USD loses another 9 pips at 496 pips from 505 and USD/JPY drops 5 pips to 432 from 437 last week. Since March 10, EUR/USD traded a 513 pip range from 1.1802 to 1.2828 while USD/JPY traded 438 pips from 109.54 to 100.77.

EUR/USD today trades 1.1831 to 1.2823 as bottoms gained 29 pips since March 10 while USD/JPY loses 28 pips on the topside from 109.74 to today’s 109.45. USD/JPY gained 6 pips on the bottom side from 110.73 to 100.80. USD/JPY trades today from 109.45 to 100.80. The compression story since FEB 23rd derives from USD/JPY as both tops and bottoms restricted while EUR/USD bottoms are formed solid supports.

EUR/USD managed 1.2397 highs last week from stated break points at 1.2341, 1.2354, 1.2361 and 1.2400 then dropped 100 pips to 1.2299. Sell points last week were also stated at 1.2361 to 1.2400.

This week, break points are wide as EUR/USD longs must remain above 1.2327 to target 1.2361, 1.2397, 1.2451 and 1.2505. Watch most vital 1.2397 as this point upon a break assures 1.2451. Sell points are located at 1.2397.

Below 1.2327 then next comes 1.2308, 1.2288, 1.2274 and on to biggest break point at 1.2235. Below 1.2235 then targets become 1.2158, 1.2153 and 1.2082. EUR/USD contains its best shot this week to break 1.2235 and 1.2235 will deploy as upper resistance to a lower EUR/USD. Higher EUR/USD remains challenged by overbought 1.1300’s and 1.1500’s. A lower EUR is required to relieve overbought before a 1.2500 EUR has any shot to sustain.

Most conflicted USD/JPY higher must break 107.95 to target next points at 108.42, 108.68 and 108.94 then consideration to the 5 year average at 109.93. This week’s USD/JPY contains every ability to break 107.95 then trade to 108.42.Overall higher USD/JPY will remain slow and deeply challenged.

USD/JPY below must break 107.07 then comes many and rough points in the 106.00’s beginning at 106.62, 106.22 and 106.15. Good long points at lower 106.00’s.

Week 8 and the same story remains as breakouts must be seen to offer any decent trade. Currently, it doesn’t exist.

 

Brian Twomey

 

AUD/USD, AUD/JPY, AUD/NZD: Levels, Ranges, Targets

AUD/JPY’s April 6 post was written to target 84.27 on an entry at low 82.00’s. Friday April 13th, six days later, AUD/JPY traded to its top at 84.07. The gain was + 200 pips in 6 days and slight 20 pip miss on exact target. The low April 6 was 81.90 and personal entry was 82.06 but again most important overall is diversification of currency pairs to + 100 pips or better trade targets.

Possibly this month, 40 pairs post and + 4, 000 pips. Possibly because until calculations are done, its impossible to know where a currency price ends and begins. Alternatively, If dead markets are seen then maybe trade 5 or 6 currency pairs continuously up and down in my Statistical Price Path. Possibly, all Euro, CAD or all GBP. Either way, my trades write future headlines.

Possible future educational post must address not understood concepts taken as gospel in currency trading such as Overbought / Oversold, Stops, entries, targets, liquidity, outside events / economics vs currency price. A target must complete its destiny and everything else related to the price is irrelevant. Respectfully, 50 and 100 pip trades leaves unearned pips. Automatic computer trades and Algorithms are miles off and wrong. All statistically quantified in above facts as I continue years later to factor trades by pencil, paper and simple calculator.

Ongoing trades, EUR/CAD, AUD/NZD, AUD/USD and GBP/CAD. AUD/JPY is complete.

AUD/USD 4 weeks later represents a miserable dead range currency pair. Friday saw 0.7810 against the overall 0.7834 target from 0.7680’s entry. The base seen weeks ago to propel AUD/USD higher no longer exists and today’s AUD sits in undecided zones.

AUD closed on its vital higher / lower break point line at 0.7764 to offer undecided context. Further, AUD/USD is most conflicted against its AUD/NZD and AUD/JPY counterparts. All 3 pairs should be miles higher especially AUD/NZD but AUD/USD and AUD/JPY are in current buy drop mode.

As AUD/JPY is offered, no interest exists because its a quick short term trade only unless lower 82.00’s are traded and its highly doubtful. For interested, reload longs at 83.05 and 82.80 to target 83.60, 83.75 and 83.82. Caution at main break line at 83.82 and only above then will 84.29 be seen. Forget 85.00’s as those levels are solidly blocked. AUD/JPY must trade to 83.75 and longs only is the way. Only existent points below are 82.19, 81.94 and 81.51. Should a good spike low be seen on RBA then quickly I will enter long to target 83.75.

AUD/USD is in the same predicament as AUD/JPY. The target remains 0.7836 and 2 pips higher than previous 0.7834. Below 0.7764, game plan is reload longs at minor lines at 0.7731, 0.7729 and 0.7716. The main line is located at 0.7698. Above 0.7764 then on to 0.7836 by breaks at 0.7791. Target at 0.7836 is located just shy of major points at 0.7841 and 0.7864.

Overall AUD/USD plan is take profit at market open for an 80 + pip profit and embark on a 2nd long trade.

Lower AUD/USD and AUD/JPY should now offer the opportunity to finally see AUD/NZD higher. AUD/NZD as mentioned in the March 30 post should trade to 1.0900’s and targets at 1.0700’s. The 1.0700’s now align as many and rough starting at 1.0734, 1.0745 and up to 1.0788. The main break line is located at 1.0698. As AUD/NZD seriously under performed and AUD pairs currently remain a waste of time, I’m looking to the exit at 1.0665 and walk with a 65 ish pip gain.

Current AUD pairs lack any meaningful trades except short trades and targets are seen weeks later. Overall, no need exists to trade AUD pairs as many other pairs offer far better, more safer and many more pips quickly.

Brian Twomey

GBP/CAD, GBP/NZD, More Monthly Recap: Levels, Ranges, Targets

Today represents 1 month since the March 14 USD/CAD and CAD/JPY posts. The personal objective was 30 pairs posted and + 3000 pips. The count is about 25 currency pairs from the majors and 4  pairs to include HKD, NOK, KRW and CNY. Certain currency pairs can’t post because no trade exists and the analyst CAD/CHF is a great example. CAD/CHF is actually an embarrassment to post as a trade by itself. CAD/CHF and other currency pairs fit into what I call Complementary Currency Pairs and those pairs are used specifically for “other” trade purposes.

CNY achieved 300 pips and despite a wild currency pair, far more upside exists. Not sure regarding overall pip count but assumption is far more than 3000 pips were achieved. Far more gains would’ve been seen if I held positions to targets. EUR/AUD for example runs currently +391 pips from 1.6191 ish and achieved new lows overnight at 1.5801 and soon we’ll see 1.5738 and lower.

Only AUD/NZD under – performed and remains off its entry while every currency pair posted achieved objectives. AUD/USD is near 0.7834 targets and AUD/JPY now runs +195 pips. AUD/USD and AUD/JPY require review for AUD/NZD insights but I’m committed to AUD/NZD longs.

EUR/CAD now runs + 86 pips and far more downside to go.

Think about Overbought / Oversold concepts, entry prices and the laughable Professional Score to judge statistically trader performance, success / failure. Review any of the 30 ish currency pairs and ask does an entry price matter. Did it matter where to enter EUR/AUD, EUR/GBP, USD/CAD, CAD/JPY. Only consideration is target, not entry and the Professional Score is highly suspect to its calculation measures. Respectfully, currency traders today especially the post 2008 crowd have much to learn. Thank you to my sincere friend Peter Wadkins as he celebrates his 45th continuous year in FX on November 5th.

GBP/CAD at 1.7900’s just launched a fresh trend lower as long as prices remain below 1.8038 and 1.8068, most vital is 1.8038.

GBP/CAD meets the trade criteria but doesn’t offer a giant trade gain.Watch for entry at 1.7945 and 1.7984 today.

Targets are first at 1.7815, 1.7772, 1.7731 and 1.7701. Overall, 1.7701 is a must break for lower prices and additional gains. As 1.7815 is a minor break, target overall is 1.7772 but again no need to marry specifically 1.7772 as this point is a huge break and no further need to play around rough break points.

GBP/NZD is a currency pair I don’t like. GBP/NZD’s journey represens a huge correction. Lower overall and sell price rises is the way but GBP/NZD contains problems as lower will take some time. Lower means eventual breaks at 1.9253 and 1.9188.

More pairs will post to conplete the 28 majors then consideration to many others.

 

Brian Twomey

 

EUR/JPY and Currency Markets: Levels, Ranges, Targets

CAD/JPY’s target from the March 14 posted trade from 80.58 was 84.71 and 85.27. CAD/JPY dead stopped at 85.24 for a 469 pip move. USD/CAD dropped 596 pips overall from 1.3140’s.

The overall question to currency markets is what’s next and where are we going. Currency markets presently lack leadership and a leading currency pair to decide the next moves. Most of the 28 currency pairs among the G10 are settled into dead ranges and next trades to meet 150 to 200 pip targets are becoming harder to find. The muted response from yesterday’s Fed minutes offered in real time exactly what dead ranges mean.

Responsibility to the where next question must come from the 7 and now into week 8 range compression problem between EUR/USD and USD/JPY. As leading cross pair by most widely traded among all cross pairs on the planet since 2001, EUR/JPY is deeply affected by EUR/USD and USD/JPY’s range dilemma. Currency markets are screaming for a USD/JPY, EUR/USD and EUR/JPY breakout to see prices in many currency pairs to get moving again.

EUR/JPY’s settled yet small ranges for example affected CHF/JPY, AUD/JPY, CAD/JPY, NZD/JPY and GBP/JPY. A 150 and 200 pip move in the above pairs presently doesn’t exist as next moves lack clarity. Leadership must and will come from EUR/JPY and CAD/JPY.

On the USD front, USD/CAD will struggle to move higher and remains in sell rally mode while USD/CHF trades in dead ranges. USD/JPY must lead the way.

EUR/USD is clearly responsible to drive further prices in AUD/USD, NZD/USD and GBP/USD.

EUR/CAD as the strangest currency pair on the planet will lead the way as speculation without a view into AUD/CAD, GBP/CAD and NZD/CAD. Severe overbought in EUR/CAD leads speculation. Least concern is AUD/CAD as even yearly moves dated to the 1990’s never saw 500 pip years.

EUR/AUD and GBP/AUD still offer opportunities as well as EUR/NZD and AUD/NZD. CAD/CHF and GBP/CHF remain in dead ranges.

Overall in the past month, the vast majority of trades derived from cross pairs and its speculation again the majors in EUR/USD and USD/JPY to now break and lead the cross pairs.

Reaming pairs to view and possible trades are GBP/NZD, GBP/CAD, NZD/CAD, AUD/CHF, NZD/CHF and try again for NZD/JPY. If nothing exist then maybe USD in central Europe in PLN or ZAR, INR.

EUR/JPY is fast approaching its tops at 133.11 and above 133.11 then a short only strategy exists. The vital break point below is located at 131.95 therefore range becomes 133.11 to 131.95. Upon a 131.95 break then range becomes 131.95 to 131.18.

EUR/JPY should properly trade between 131.58 to 131.18 but 131.95 must first break. The 130’s are many and rough first at 130.94, 130.81, 130.70, 130.60 and 130.29. What holds EUR/JPY from a deep dive is 129.52 and 128.65.

Short is the only strategy yet upon a 131.95 break, caution to 131.18. EUR/JPY like all JPY crosses offers quick pip trades until the EUR/USD and USD/JPY situation resolves itself by economic release or un forseen outside event.

 

Brian Twomey

 

EUR/CAD Vs EUR/CHF: Levels, Ranges, Targets

Overnight AUD/USD broke reported 0.7759 and achieved 0.7768 and now target at 0.7834 is close, 3 weeks later. AUD/JPY from lower 82.00’s achieved + 137 pips at 83.37 and on to 84.27 ish target. EUR/AUD and EUR/GBP traded to new lows. although 296 and 100 pip objectives were achieved. EUR/JPY now approaches 133.00’s from reported 131.80’s break point and deserves a deeper view as 133.00’s represented EUR/JPY’s top weeks ago. All EUR G10 currency pairs remain deeply challenged at the topside and today’s Skitzy EUR/CHF and EUR/CAD add to the mix.

EUR/CAD’s price represents a currency pair inside a currency pair and this describes both a skitzo and dangerous situational currency pair. Short term, EUR/CAD trades within a well defined larger range from 1.5309 to 1.5825 but this range is further contained by break points at today’s 1.5567 and 1.5656. Above 1.5656, targets 1.5825 and below 1.5567 targets 1.5309.

Longer term EUR/CAD richter scale overbought is an understatement as EUR/CAD’s rightful place is found at middle to lower 1.4900’s and 600 pips below its current price. The danger to EUR/CAD is its subject to a deep dive and a drop to occur anytime. EUR/CAD awaits the spark then its gone. EUR/CAD’s currency pair within a currency pair short term contained the short term price and prevented it from its impending drop. The shorter term view and daily metrics hides what’s behind the actual price.

As EUR/CAD longs are impossible, the short strategy is target the impending break at 1.5567 then 1.5309. At 1.5309 is the break line to see a further massive drop to begin an advanced trend lower to 1.4974.

EUR/CHF’s longer term downtrend is well defined below its main break at 1.2388 then 1.2262 and ironically 1.2009 followed by 1.1923. Critical at 1.2009 was the overall point when the SNB in 2009 released the EUR/CHF long held floor at 1.2000 to see a 3500 pip drop in 15 minutes.

At 1.1800’s, the downtrend trend represents beginning stages yet the trend is not only stagnant but highly undecided as the shortest term break points are located from 1.1702 to 1.1923. Shorts must break 1.1778 then 1.1702 to target 1.1671, 1.1653 and 1.1626. Shorts today must drop to 1.1778 and below while longs are impossible despite a low and highly undecided price.

Strategy is shorts only for the impending break at 1.1702 particularly as EUR/CHF’s downtrend will begin again and because price rises are forced market corrections.

Overall, no thrills exist to a longer term trade as EUR/CHF is a slow slow mover currency pair. EUR/CAD long term shorts however upon the 1.5500 break is a far better trade yet patience is required.

Brian Twomey

AUD/USD and Trade Recap: Levels, Ranges, Targets

Since March 14 and the begining of current trades that began with USD/CAD, 20 currency pairs were posted to exclude the weekly EUR/USD V USD/JPY trades. All trades performed as written against the goal to post currency pair targets at + 100 pips or better.

Most pairs performed far more than the 100 pips intended. For example, EUR/AUD, GBP/AUD, EUR/NZD, USD/CNY, USD/CAD, CAD/JPY, USD/NOK all profited at + 200 pips. GBP/CHF as the best trade overall at a 500 pip potential profit was missed and only seen by the time to factor the trade was a 300 pip dead range and untouchable. USD/HKD seriously underperformed therefore I bailed with a few pips profit and not to touch again as HKD serves a far more different purpose today than its once highly trade able currency pair.

No trade was found in KRW and this condition may last for many months if not years. Signature on the South Korea / US trade deal may move KRW but not until after the May/ June meeting with Trump and North Korea.

AUD/NZD as the only under performer ran a 50 + pip profit first then a 90 ish pip loss. The long trade remains to target 1.0700’s. AUD/JPY and AUD/USD longs remain to target and both are running profits. Many more pairs will post against the continued objective at 100 pips or better. The goal is currency pair diversity in 30 + currency pairs rather than pip amounts although 100 pip trades remains the target.

In the March 23rd AUD/USD post, a base formation was reported and this was correct as AUD drove 70 + pips higher however the base formation was reason enough to remain for higher levels. And despite a 3 week trade for 150 + pips. The base formation is partially explained by only 2 levels below exist for AUD and those levels are located at 0.7582 and 0.7574. The second explanation is drivers at 0.8200’s.

What drove AUD March 23rd was 0.8260 and must break 0.7797 as opposed to March 1st at 0.8264 and 0.7813. AUD drivers today are 0.8257 and must break at 0.7759. The topside fails to drive much lower to lower 0.7600’s and 0.7500’s.

The objective is target at 0.7834 on a break of 0.7759. At 0.7834 remains however a fluid number as resistance now exists at 0.7834, 0.7837 and an upper line at 0.7862. The line at 0.7862 requires consideration within the next week.

The overall lesson and message to past and future trades is not to lose sight of the long term forecasts as the trades see far ahead to prices. Far ahead views informs the economics and/ or political events to influence the price. March 23rd, nobody considered AUD but 3 weeks later, a new AUD interest exists. March 22nd, EUR/NZD 1.6800’s was the break point and today, EUR/NZD trades 1.6700’s. Much more to come.

Brian Twomey

GBP/USD V GBP/AUD: Levels, Ranges, Targets

GBP/USD trades in a 599 pip range from 1.3926 to 1.4525. Above 1.4525 then next point challenges the 5 year average at 1,4684. The topside to GBP contains many problems.

The first dilemma is GBP is driven short term by 1.3074 and 1.3325 and both are severely overbought. Longer term, GBP is embarking on a massive correction from 1.1900 lows and the overall price must remain below 1.5226 and 1.5276. Secondly, GBP trades at the top of its range and GBP can’t handle a higher price and this means not 1 pip above current prices. The longer term strategy is sell rallies. The most comfortable range for GBP is 1.4001 to 1.3896.

A large gray area exist from 1.4101 to 1.4203 and this represents an uncertain danger zone. GBP should actually trade to 1.4203 then 1.4280 but its not ready to travel higher. At 1.5226 and 1.5276 are slightly oversold while 1.3074 and 1.3325 are severely overbought and this creates the 1.4101 to 1.4203 undecided zone.

Sell rallies means below 1.3926 to many and massive supports at 1.3878, 1.3870, 1.3862 and 1.3765. Should GBP ever break through this zone then next comes 1.3654 and 1.3613 and on to 1.3325. Below 1.3977 and 1.3926, breaks at 1.3800’s will take time. The most important point is 1.3878 to travel lower.

GBP/AUD at current 1.8348 represents a trend just beginning as long as GBP/AUD remains below 1.8696. Any price rises can only travel to sell points at 1.8377, 1.8420 and 1.8476. The next break point below targets 1.8278 and 1.8252 then the 5 year average and caution at 1.8127 . Seen in GBP/AUD is confirmation to a lower GBP/USD and sell rally strategy. Further seen in GBP/AUD is miles of downside exists. If the 5 year average breaks at 1.8127 and a good shot exits then targets become 1.8040, 1.7953, 1.7944 and 1.7915.

 

Brian Twomey

EUR/USD V DXY V USD/JPY: Levels, Ranges, Targets

Again as EUR/USD and USD/JPY embark into Week 7 since February 23rd, range compression continues as EUR/USD loses 5 pips to trade wides at 1.1824 to 1.2824 while USD/JPY drops 3 pips to trade 100.79 to 109.50. USD/JPY lost 24 topside pips from 109.74 since March 10 while EUR/USD gained 22 pips from 1.1802 to 1.1824.

The 7 week explanation on failure to break significant levels is absolutely certain as cause for range compression but a far better interpretation is DXY trades 585 pips between its 5 and 10 year averages from 91.45 to 85.60. DXY Friday broke most crucial 89.95 and threatens lower at next 89.06 and then a far distance to next points at 87.36, 86.62 and 86.01.

The DXY break at 91.45 in January and 89.95 explains EUR/USD support formation as well as USD/JPY topside drop. but fails to explain an uncertain price in USD/JPY. A DXY break lower as well is comfortable within its longer term 86.11 to 93.78 range.
Above, 90.28 and 90.66 must break in order to consider a run to the 5 year average at 91.45 on breaks at 91.05 and 91.15.

Above 91.45 longer term then next comes 92.41 and 92.77. Overall, DXY trades inside 200 and 300 pip ranges as the past 7 weeks traded 88.00 to 90.00’s. Below 89.95, DXY remains in downtrend mode and a trend just underway.

EUR/USD possible base from last week failed to materialize this week as the overall EUR/USD price failed to move to significantly change the forecast. EUR/USD is stagnant but focus to the downside as 1.1400, 1.1300 and 1.1200’s remain far overbought. EUR/USD requires another drop before a move higher and the same story from last week.

EUR/USD sell points for the week are located at 1.2341, 1.2354 and 1.2361 then 1.2400. Severe caution from danger zone between 1.2361 to 1.2400. Below, 1.2241 and 1.2220 must break to target 1.2155, 1.2081 and 1.2026. Caution as 1.2026 as a break is the line to target the 5 year average at 1.1957.

Higher for USD/JPY must remain within 106.61 to its significant break point at 107.85. Higher must break 107.12 then 107.85. Massive headwinds ahead on a 107.85 break at 108.25, 108.79 and 108.86. USD/JPY’s line at 108.86 is crucial to target the 5 year average at 109.89. USD/JPY remains in week 2 as a struggle against itself and 107.85 will provide significant resistance and not ready to crack. View 107.85 to EUR/USD 1.2220.

Below 106.61 targets 106.22, 106.15 and 106.01 then a massive dropoff to 105.26 and 105.15. Good long point at lower 106.00’s. Overall, USD/JPY remains at the top of its range and higher will remain a struggle.

The trade methodology over years for USD/JPY and EUR/USD is the day trade as those trades are far more exact, reliable and profitable rather than play around with current break points.

 

Brian Twomey

AUD/JPY: Levels, Ranges, Targets

AUD/JPY’s direction is up and long any drops contains the only strategy as short trades are literally impossible.  Current AUD/JPY at 82.00’s is oversold short and long term.

Most vital break points above are located at 83.02, 83.65 and 83.72 to target 84.27 . Most vital in this series is 83.72. Further targets above 84.27 include 85.04, 85.08 and 85.32.

The 10 year average is located at 85.29 therefore no interest exists longer term to target higher than 85.04 and 85.08. The 10 year average at 85.29 contains the big break point to target much higher levels but overall six break points exists at 85.00’s and those levels are located at 85.04, 85.08,85.32, 85.33, 85.59 and 85.70.

Below only two break points remain overall and those levels are located at 81.91 and 81.51. For today only, 81.80 provides the only support. The most immediate range overall is located from 81.91 to 83.02 and upon a break of 83.02 then the range becomes 83.02 to 83.72 and down the road 83.72 to 84.27.

The longer term and 100 pip trade for AUD/JPY is target 83.72 upon a break at 83.02. The perfect entry price especially on today’s NFP day is long on a drop from 81.80 to again target 83.02 and 85.72.

Overall, AUD/JPY is a slow mover yet reliable as a target trade but patience is required because AUD/JPY contains smaller ranges than its EUR/JPY and GBP/JPY counterparts.
Brian Twomey

USD/NOK and CAD: Levels, Ranges, Targets

USD/NOK since March 14th represents the 15th currency pair posted and 16th to include the no trade, 300 pip GBP/CHF range. All posted pairs performed as written but all posted pairs contain long range forecasts and may last for weeks or longer. EUR/AUD and EUR/GBP for example were posted March 27 and March 28 when EUR/AUD shorts entered at 1.6191 and EUR/GBP from 0.8797. EUR/AUD achieved new lows again overnight at 1.5895 and runs 296 pip profit while EUR/GBP runs +78 pips at 0.8719 lows. USD/CNY achieved new highs at 6.3100’s from 6.2874. AUD/NZD maintains laggard status as written and is just fine.

USD/CAD and CAD/JPY were first March 14th from USD/CAD short at 1.3140’s and CAD/JPY long from 80.58. The target for CAD/JPY as written was 84.00’s and CAD/JPY is close to its vital break point at today’s 84.53. A break then higher goes CAD/JPY to 86.00’s. Most vital is USD/CAD at today’s break point at 1.2762 then comes 1.2660 which means CAD/JPY at 85.00’s. After 3 weeks, both pairs must refactor and repost for exact levels and break points.

USD/NOK current 7.8482 contains topside problems as its price is high and overbought. Best aspect to 7.8482 is this price lies just under the next most vital break point at 7.8542. A break above 7.8542 places USD/NOK into a larger range as well as far more overbought status from 7.8542, to 7.9076 and 7.9358.

USD/NOK shorts must travel to at least 7.7724 and far lower overtime. Far lower over time means USD/NOK contains easy potential to challenge its 5 year average at 7.4955 upon a break of 7.7489. Current NOK trades above its 5, 10 and 14 year averages.

Further overbought means extreme caution at 8.0011 and 8.2927 yet current overbought points won’t be seen because NOK can’t handle nor won’t hold those levels. USD/NOK is a wide wide range currency pair.

Context to 8.0011 and 8.2927 is next break points and top of the multi year range are located at 8.1973, 8.2018 and 8.2867. USD/NOK contains one direction and its lower as longs are impossible.

First break points below are located at 7.8377 then clear sailing to target at 7.7724. Why target at 7.7724 is because USD/NOK over next days will sustain deep trouble holding 7.6907 and 7.6498 and 7.7489 is a huge break point. To see 7.7600’s will take time.

Next posts GBP/AUD although so far no enthusiasm for this pair. USD/MXN and CAD/MXN for possible NAFTA trades. AUD and NZD/JPY and CHF/JPY completes G10 JPY crosses. My currency pair arsenal contains 476 currency pairs so much more to go.

 

Brian Twomey

 

EUR/USD and G10: levels, Ranges, Targets

USD/CNY from Monday’s 6.2874 offered a gift to drop to 6.2691 and now trades 2 days later at 6.3056. Miles of upward distance remains as well as the continued buy dip strategy. USD/CNY is a terrific currency pair but as volatile as BRL because both pairs were built for distance. USD/HKD remains and lives overall in tiny ranges. From Monday USD/HKD waits for its impending dive. No interest and wasted effort in KRW.

EUR/AUD achieved new lows at 1.5919 from 1.6100’s. EUR/AUD above 1.5700’s will remain the long time gift and continued short strategy. Current price 1.6055 and short is the way. EUR/AUD is a reliable currency pair to hit targets as well because AUD , NZD and EUR are faithful as target trades.

EUR/GBP from 0.8797 also achieved new lows at 0.8719. EUR/GBP as well contains more downside. EUR/GBP remains a miserable currency pair because its mis positioned and no reason exists to trade this pair other than for professional purposes.
GBP/CHF as mentioned achieved 1.3500’s and dropped. GBP/CHF now trades 1.3513, 1.3500 to 1.3257. Nothing special here in GBP/CHF.

EUR/USD as mentioned required another downside before higher it goes. Held this week was 1.2323, 1.2360 and 1.2385. EUR/USD hit the gap at 1.2334. As mentioned again, watch the Gaps. I saw Gaps coming long ago and Gaps are now perfectly covered. Do or Die break point is here at 1.2228. Far lower upon a break. Watch 1.2236 today to challenge 1.2228. EUR/USD possible base as was seen in AUD requires further inspection.

USD/JPY. Had to trade to 106.61, it traded to 106.68. Bottom 105.16 held twice in the 105.60;s. Today’s downside break point now 105.89 and topside at 106.51 and big break point to see 108.00’s remains now 107.82.

USD/CAD break points below 1.2766 then comes 1.2660 Vs topside at 1.3092. Range 1.2766 vs 1.3092. Nothing special in CAD yet.

Remember EUR/NZD, it broke reported 1.6924 and 1.6893 from topside at 1.7088. Watch target at 1.6772 and above break points now 1.6893 and 1.6916.

NZD/USD Break Point and higher or lower line now 0.7230.

AUD/USD base was correct and AUD went higher to achieve so far 0.7715. Only points left for AUD/USD downside is 0.7688 and 0.7577. Upside break to see 0.7828 is located at falling 0.7772. I remain committed to 0.7828 and long any drop strategies.

AUD/NZD first achieved 1.0650’s from 1.0600 then achieved lows at 1.0534. No question to buy drop strategy and 1.0700’s then reconsideration to bother with AUD/NZD.

GBP/USD big break for lower now 1.3879 and 1.3842. April 23rd becomes final to BOE money market changes after a 2 year study to change money market structures. Say hello to the new AUD as the BOE will take part of the Great in the Great British Pound. The GBP character remains but the BOE chipped away at the edges to eliminate volatility. Overbought begins at 1.4181.

EUR/JPY first break point is located at the 5 year average at 130.78 then 14 year at 131.54 followed by 131.80. At 131.80 is required to travel higher but remember the top at 133.00’s. Rough road above for EUR/JPY.

GBP/JPY doe or die at 149.59.

AUD/CHF must break from current 0.7366 is located at 0.7422 then 0.7475.

NOK, SEK and many more pairs at 100 pips or better will post. Many exist. Above is just the warm up.

 

Brian Twomey

 

USD/KRW and Intervention: Levels, Ranges, Targets

What South Korea’s central bank head Lee Ju Yeol views in the intervention issue is USD/KRW is far to high and must drop therefore KRW rises. Yet Lee overall spoke intervention before in January and February against statements to only intervene if exchanges rates fell outside normal market activity.

While South Korea’s headline interest rate is currently 1.50%, it traded in February from 1.49% to 1.54% and the average deposit rate jumped to 1.80% in January and February. Why February is because the BOK releases interest rates at month end. 3 month Kibor however remains stable over the past 7 months at exactly 1.65% and contains no effect to the recent rise in USD’s Libor -OIS rate.

In 3 month USD Libor in March was 2.31, 2.02 in February and 1.78 in January V the BOK at 1.65. The 3 month Kibor rate tracks current 3 month CD’s, now at 1.65 and stable over the past 8 months. The 10 year KRW bond yield in March was 2.74%, down from 2.86% in February and 2.71 in January. Overall, no alarming indications to an immediate intervention and Lee’s statements may serve strictly as a warning.

While South Korea and Japan import Steel and Aluminum to the United States, the main exports are autos as $21 billion in Korea auto imports were recorded for the full year in 2016 and this figure is rising. Total trade in 2016 was $144 billion as the US exported $63 billion to South Korea’s $80 billion imports and a $17 billion deficit.

Korea is the US 6th largest supplier of goods and a vital market to Korea overall as the 2017 deficit in goods reached $25 billion as far more imports than exports are shipped to the United States. Its the Good side of the equation as cause for Trade concerns overall.

Korea maintains a Tree Trade Agreement with the United States since 2007, renewed in 2012 and the assumption is Korea will maintain Free Trade status in the yet to be signed new agreement.

Second aspect to intervention is an explosion is coming to the USD/HKD V USD/CNY relationship and more Correlation work is needed to assess what this means for KRW from a trading angle. The BOK sees this scenario overtime as they calculate their exchange rates from long term perspectives.

The overall assumption for all Asia currencies against Trump’s Steel and Aluminum Tariffs is to devalue the currencies. The assumption however is ongoing and yet to materialize but intervention may be the first of more to come by Asia’s central banks.
The BOK and Lee are watching USD/KRW 1073.59, 1078.88, 1095.64 then the 14 year average at 1098.07. Most vital overall are 1078.88 and 1098.07 as breaks will take USD/KRW higher to 1111.00’s over time. The problem with higher USD/KRW is the current 1058.07 price is far to high and must travel lower yet at 1058.07 is off the charts and must rise.

Technically, USD/KRW is literally in a nightmare and complete dilemma position overall. Nightmare is hardly a technical word but USD/KRW is struggling against itself and its the same scenario reported in USD/JPY. As to direction its unsure of itself. Its not a pair to trade currently.

Further and most vital Asia pairs to watch, followed by break points as reported currency pairs below are most important to not only trade but the CNY V HKD relationship.

CNY/JPY , 16.9010 and 17.0576. 5 year average = 17.1668. Current price = 16.8745

CNY/KRW — 169.2337 and 167.9023 Vs 5 year average = 173.9914. Current price = 167.97

 

Brian Twomey

GBP/CHF: Levels, Ranges, Targets

The purpose to post GBP/CHF is because it was noted on the retail analysts radar. As suspected and I should’ve known better, no trade exists. But the right church, wrong pew revelation answers to what degree and how dangerous are these types. Further pairs on the analyst radar to not view are CAD/CHF and NZD/CAD. The CAD/CHF trade is easy as we know USD/CAD and CAD/JPY and the best of both trades were done weeks ago. What is CAD/CHF, its CAD/JPY.

The shame to GBP/CHF is the absolute best of this trade was seen March 2nd at the 1.2800 lows and the further gains were derived March 13 from breaks at 1.3199 and 1.3228. This trade was a 400 to 500 pip gain in 2 weeks. But consider EUR/AUD 200 + pips in less than 46 hours, same for EUR/GBP + 60 and USD/CAD as well as CAD/JPY. Obviously this exercise is over.
Now GBP/CHF is stuck between 1.3228 and 1.3500’s and its untouchable. Untouchable because the GBP/CHF trade is done and plenty of 100 + pip easy trades exist so never to touch the EUR/USD or USD/JPY type pairs playing around at break points.

The 1.3500’s to this trade exists at 1.3513 and 1.3582 Vs below at 1.3228. Below 1.3228 then 1.3199 and 1.3081. Consideration to a quick day trade is short to 1.3377 and below.
Brian Twomey

USD/CNY Vs USD/HKD: Levels, Ranges, Targets

USD/CNY trade history as a result of the 2005 internationalization of the Yuan began July 2005 at 8.0351 then dropped over 1200 pips 3 years later to 6.7922 in July 2008. From July 2008 to May 2010, USD/CNY traded in dormant stages inside a 795 pip range from 6.8895 to 6.8090. USD/CNY’s 789 pip downtrend resumed from June 2010 to June 2014 from 6.8305 to a 9 year bottom at 6.0406. An uptrend began from 6.0406 to June 2017 highs at 6.9622. USD/CNY trades at current roughly 6.2874.

If the past is prologue as in the EUR/USD 9 year bottom at 103.00’s and GBP/USD’s 9 year bottom at 1.1900’s then USD/CNY currently embarks on a multi year uptrend and possibly a multi year correction from 8.0351.

USD/CNY since 2005 and in 144 traded months, 99 down months were seen as opposed to 45 up months.

USD/HKD from July 2005 at 7.7730 bolted 568 pips to 7.8298 in July 2007. USD/HKD from current 7.8489 trades at 29 year highs not seen since January 1989. As a result of the Plaza and Louvre Accords in the 1980’s, USD/HKD traded briefly from 1984 to 1989 in the 8.0000’s. Overall, USD/HKD’s larger price history began from 5.71 in January 1960 and trades at the top of a 58 year uptrend.

USD/HKD is far from richter scale overbought since 1999 and beyond but current price is unsustainably overbought and desperately needs a correction. Noise levels on certain days achieve maximum statistical capacity seen historically only in current EUR/DKK. USD/HKD risks not just a correction but an explosive downside move. Long USD/HKD is literally impossible in favor of a short only strategy.

As USD/HKD trades miles above its overbought 5, 10 and 14 year averages at 7.7673, 7.7676 and 7.7727, the first target lower is located at 7.8208 followed by 7.7982, 7.7923 and 7.7889. USD/HKD should and will trade to its current comfort zone at 7.7923. Perspective to overbought is USD/HKD must correct at least 600 pips and longer term, no reason why a challenge exists to the 14 year average at 7.7727.

USD/CNY from 6.2874 must trade 997 pips higher to easily 6.3268, 6.3779 and 6.3871. USD/CNY trades miles below its 5, 10 and 14 averages at 6.4062, 6.5127 and 6.8172. USD/CNY is severely oversold particularly from its current longer term break points above at 6.4840 and 6.5213. The 10 year average at 6.5127 is well protected. Despite CNY / Yuan internationalization since 2005, the 14 year averages was obtained from the ECB.

Historically, USD/CNY was fixed and maintained a 1960 price at 2.4618 until it traded at 2.2450 at the January 1972 free float. Since 1972, CNY dropped to 1.84 lows then embarked on an uptrend until its was again fixed at 8.2700 from January 1997 to July 2005 until it again free floated at 8.2165. The 58 year mid point is located at roughly 5.3391 to 5.3659.

AS USD/HKD traveled higher, USD/CNY traded lower and now both pairs trade far outside respectable averages and range boundaries and both must correct as current price levels are unsustainable.

 

Brian Twomey

 

EUR/USD V USD/JPY : Levels, Ranges, Targets

As EUR/USD and USD/JPY head into week 6, range compression remains the story as EUR/USD’s overall range dropped from 524 pips Feb 23rd to 505 this week while USD/JPY’s longer term range dropped from 447 pips to current 438.

EUR/USD’s 505 pip range means this week’s larger range is located from 1.1821 to 1.2825 and March 10, the range was 1.1802 to 1.2828. This week’s USD/JPY larger range is located from 109.54 to 100.77 and March 10, the range was 109.74 to 100.73.

Neither EUR/USD nor USD/JPY wider ranges failed to materially change over 6 weeks. Constriction at the wider ranges causes compression at the short ranges as EUR/USD and USD/JPY trade aimlessly over 6 weeks. Failure to break significant points is a slack explanation part of the story.

EUR/USD 1.2800’s remain blocked particularly 1.2807 at the 10 year average and 1.2841 at the 14 year average. Why failure at 1.2800’s is because averages at 1.1200’s, 1.1400’s and 1.1700’s achieved astronomical overbought. Those averages remain overbought into week 6 but as EUR/USD continues to range trade at current lower levels, skyrocket overbought is fast losing its status and moving to normality.

USD/JPY was and remains deeply oversold at 113.00’s, 111.00’s and 110.00’s while the downside over the past 6 weeks was severely blocked at high 104.00’s to lower 105.00’s. USD/JPY downside this week is severely blocked at 105.16 and 104.69 but both are the lower break points this week to challenge its deeply oversold 14 year average, now at 102.99.

EUR/USD’s past few weeks report was its price is to high and must adjust lower and it performed as written. This week however EUR/USD is forming a base and the same base reported in AUD/USD. USD/JPY is severely afflicted with uncertainty as it desperately wants higher levels but lacks ability at its break points therefore USD/JPY fails to lead the way this week in favor of EUR/USD.

Higher EUR/USD must break 1.2323, 1.2360 and watch closely the sell point at 1.2385. If EUR/USD travels above 1.2385 to the next break point at 1.2402 then short to 1.2385 and below.

Watch 1.2319 as 1.2319 represents the last level to the most vital break at 1.2231. If EUR/USD is forming a base to travel higher as it appears then 1.2231 will hold and EUR/USD moves higher to the upper 1.2385’s. EUR/USD is challenged at 1.2231 by 1.2208 and a break targets 1.2158, 1.2153 and 1.2077. A break of 1.2231 will see 1.2077.

Overall, EUR/USD still must travel lower before an upmove begins.

USD/JPY to travel higher must break 106.61 and most vital 107.71 to target 108.77, 109.19 and the 5 year average at 109.86. From the close at 106.28, USD/JPY travels higher to challenge 106.61

Lower USD/JPY means 106.21, 106.16, 105.28 then 105.16 at the break point. Long on any price drops to 106.61 is the overall strategy as 105.16 holds.

Overall USD/JPY range 107.71 to 105.16 and EUR/USD 1.2231 to 1.2385 and 1.2402.

 

Brian Twomey