EUR/USD and 5 Day Rule: Levels, Ranges, Targets




The question to the 5 day – interest rate change rule in currency markets was to what degree was the failure and its answered by total collapse as a vast majority of currency pairs remained inside a 100 pip range. The 5 day Rule derives from currency markets in periods 1900’s to late 1930’s and then from 1970’s to current day. As expected and mentioned, NZD as usual wins the volatility day but EUR, CHF, JPY, AUD and the list of failures goes on. Even wide ranging EUR/AUD and EUR/NOK failed. EUR/NOK traveled 1000 pips but its allowed 500 pips of movement on any given trading day.

The manner to view the 5 Day Rule outside of national interest rates is the number of exchange rates trading at parity against each other. The world of exchange and interest rates grew deeply closer to each other over the years since crisis days. This explains why the 5 day rule failure and a paltry 100 pip range on a 25 basis point interest rate change. What’s 25 basis points inside a USD Vs EUR corridor of 50 basis points. It doesn’t register on the radar screen yet it speaks volumes to economic and central bank failure continuously over 8 years.

A marriage continuation in interest and exchange rates from a trading perspective confirms the need for a robust technical strategy. An ECB interest rate rise for example ensures Corridors remain and EUR/USD may trade 1.1300 to 1.1500 instead of 1.1100 to 1.1300. Interest rates badly need a break out in order to break the dead ranges but its not seen yet. The economic portion must lead interest and exchange rates rather than Yellen’s backward approach as interest rates lead economics. Not sure Keynes would approve of such an approach.

Further how markets found this dead range / Dead 5 day rule problem was the strict focus to protect interest and exchange rate bottoms as first priorities. GBP as an example landed inside the BOE’s 1.2300 to 1.2800 range and the result is UK money markets went dead and numb which means this range may hold for a while as bottom points are seen from 1.2639 to middle 1.2700’s. Focus on bottoms and protections questions the overall positive economic intent.

GBP/USD above targets are located at 1.2747 and 1.2796. Bottoms must break 1.2678 to see a lower GBP.

EUR/USD will severely struggle at 1.1224 so topside is seen at 1.1196. Bottoms will severely struggle at lower 1.1100’s.
AUD/USD Do or Die at 0.7528 and 0.7534.

USD/JPY must cross 111.52 to travel higher while 110.96 is current solid supports.


Brian Twomey

EUR/USD and FED: Levels, Ranges, Targets




From head of research for Richard Fisher at the Dallas Fed comes Danielle DiMartino Booth’s book Fed Up to explain why the FED is bad for America and why the Fed is acting against the interests of ordinary Americans to favor the institutions. Much more is involved in this book form 2008 to current day but interest rate rises is key focus today.

To the unanswered question to why the Fed seeks aggressive interest rate raises, DiMartino answered in yesterday’s interview is to engineer a recession under Trump’s term. An extraordinary statement yet raise rates under easy money policies is actually the result to see recession based on years of past economic prescriptions.

Easy money and accomodative policies is defined by Fed’s holdings in the SOMA Account which currently contains in all securities $4, 237, 041, 281.00, the highest total in SOMA account history. The current total fails to speak to one raise let alone multiple especially when weekly changes barely sees $10 billion. The second Di Martino answer to interest rate raises is the threat to the establishment in Trump tax cuts as slashes would unleash full economic power to the masses and threaten Fed market controls. The laugh to this statement is to consider the Fed ahead of any curve since its 1913 establishment.

Why Trump as the target is because he seeks to take down the entire Washington establishment whose sole purpose since 1988 was grow government to grow wealth for those in the establishment. Democrats are as guilty as Republicans because the 1988 election of George H.W Bush saw a transfer of power from Taft to Roosevelt Republicans. The difference between Roosevelt Republicans and Democrats is minimal, particularly when tax cuts failed to enter the lexicon since 1988. The result was government growth at the expense of the masses in the private sector.

George H.W Bush’s economy in 1992 was 1.2 trillion. Today, its speculated + 2 trillion. Why speculation is because America’s Bummer never submitted a formal budget for Congressional hearings and approval and instead worked on Continuing Resolutions. Obummer asked for phantom budget numbers and Congress approved. Trump submitted a formal budget for the first time in many years at around 2.5 trillion.

The other question to raises is exchange rate related. Fed Fund raises saw DXY from December climb 300 pips from 99 to 102’s. Rarely does the Fed mention dollar policy in statements but last May? was revealed the Fed’s desire for a lower DXY. Raise Fed Funds and opposite effects will be seen. What Tax cuts mean for the masses under a higher DXY is the current unanswered question.

Under lower Inflation, the difference maybe minimal. The Fed nor any central bank doesn’t need an interest rate change to engineer an exchange rate level. The ECB mastered that concept last June and all central banks jumped on board. Its actually far better to not change interest rates so to leave exchange rates inside small channels for extended periods.

Politics, philosophy and party labels aside, we’re beginning to see years of the effects of Obummer’s economic destruction and America at its weakest levels as the direct cause. Not a word was spoken in 8 years of America’s Bummer yet today everybody speaks. To regain America;s strong posture again will take years as tax cuts is just the start.

The recommendation is follow Dimartino as she’s not afraid to speak her mind and reveals insightful information.
EUR/USD Bottom points at lower 1.1100’s is now 1.1117 and rising. caution at 1.1199 and 1.1227 .

GBP/USD below breaks at 1.2631 and 1.2620 needed to see lower while above 1.2667 and 1.2698 to see 1.2707 an 1.2757.

AUD/USD below 0.7535 and 0.7529 musty break for lower levels.


Brian Twomey

EUR/USD and Inflation: Levels, Ranges, Targets

Carney confirmed previous mentionables as Interest rate hikes remain on hold as Brexit must be settled for UK independence, GBP hovers all 2016 and 2017 at barely 1.5, UK money markets remain fast asleep and political system as well as central banks care far less to bring prosperity. Instead of stimulus recession when markets stabilized in 2008 and 2009, central banks increased holdings. When “Green Shoots were seen in 2010 and 2011, balance sheets increased to choke off prosperity. Nearly 6 years later, interest, exchange rates and GDP remain stasis and on the floor. Yet the word Inflation won’t leave central banks verbiage.

The economic question to higher Inflation is the transmission to higher Food prices for average Joe Blow consumers and the effects how much weekly wages disappear due to payout in higher Food costs. DXY is the true commodity currency and positively correlates to Agriculture and its a number 1 export, particularly to Asia and Canada. Higher Interest rates leads to higher DXY and results in higher Food costs.

Food costs appear to track well in Inflation figures to Medical costs and Prescription drugs. Gasoline prices factors to about 0.2 to 0.4 to overall Inflation figures, depending which nation. NZD for example factors to 0.2. Higher Inflation must result in higher Gasoline prices. Now we have higher Inflation means higher Gasoline prices, Food, Medicine and prescription drugs. Wage relationship to Inflation as highlighted by Soc Gen appears as complete inverse. All prescriptions for consumer disaster and destruction to prosperity. The same old tired story from central banks is old and ran its destructive course. Trump at least is trying to pass growth policies.

GBP/USD. The break yesterday of 1.2703 saw the next line at 1.2625. GBP was heading to 1.2625 anyway, Carney allowed GBP to travel faster. GBP now remains inside the BOE’s 1.2300 to 1.2800 range. At 1.2500’s GBP remains dead center.

Below breaks are locate at 1.2601 then 1.2594 and 1.2582. Above, 1.2650 and 1.2669 provide headwinds to 1.2718.

EUR/USD. Big break at 1.1022 to target 1.0800’s is blocked by 1.1106 and 1.1086. Big break above at 1.1180’s should stop EUR rises for today.

USD/JPY supports are located at 111.04 and 110.95.

EUR/JPY. 124.90’s as mentioned failed to break higher.


Brian Twomey


EUR/USD and Cross Pairs: Levels, Ranges, Targets




NZD is most affected by USD changes to interest rates because its next in line after NY markets close, its the nation to open Asia trade and NZD Dairy is priced to USD. Most importantly, NZD sits behind the smartest and most forward RBNZ. As usual, Its the only central bank ahead of the curve. NZD/USD has been volatile and will continue its volatility to beat its counterparts AUD/USD, USD/CHF and USD/JPY.

The must break line for NZD below is 0.7231 then further supports at 0.7110 and 0.7016. Above 0.7453 and a stasis line exits as next break point. Current NZD is overbought and we’re looking lower.

Further why NZD trades is the common theme this week for a vast majority of pairs is a tight tight market and containment within 40 pip ranges. 40 is the number this week as overbought oversold hits current prices.

AUD/USD’s range problems as mentioned must result in a higher AUD to relieve the pressure. What happened was AUD went higher. Supports exists at 0.7531 and 0.7520. We’re looking lower for AUD and selling rallies.

Remember January’s CAD/MXN at overbought 15.00’s. CAD/MXN jumped to 16.70 then went on a long dive to current 13.44. Its price is low low especially in relation to CAD/JPY, EUR/USD, CAD/USD and EUR/USD. Yet CAD/MXN’s price on its own volition is low low. Above breaks are located at 13.99 and 14.03 vs below at 12.96 and 12.47.

CAD/JPY is overbought and big break below is located at 83.01.

CAD/ZAR Resistance points 9.7629, 9.7649 and 9.8845 Vs below at 8.6247. Higher in CAD/ZAR sends EUR/USD much lower. CAD/ZAR at current 9.66 and break at 9.76 then look out below EUR/USD.

EUR/JPY. Supports 122.59 and 121.52. Not a favored long pair as massive resistance has been built into current prices for the past week, today is no different as 124.90’s should contain EUR/JPY.

AUD/CAD. Support 0.9916 Vs Resistance at 1.0076 and 1.0135. Explains EUR/JPY lack of upside.

EUR/USD. Stuck today from 1.1144 to 1.1249. We selling above and buying below.
Brian Twomey

CAD/ZAR and AUD/CAD Vs Market Risk


The measure of trader preference to take on risk trades or play it safe as risk off is assessed in currency markets by 4 most prominent currency pairs: CAD/ZAR, CAD/JPY, AUD/CAD and EUR/JPY. In EUR/JPY and CAD/JPY are risk pairs while CAD/ZAR and AUD/CAD are classic risk off pairs, play it safe. Longs in EUR/JPY and CAD/JPY results in automatic shorts in CAD/ZAR and AUD/CAD which informs overall, markets are willing to take on risk.

The traditional price laggard pair in the risk off alignment is AUD/CAD while CAD/ZAR is lightening fast responsive to market prices and is the best risk off assessment in currency markets. The positive to AUD/CAD’s slow move price is it becomes overbought / oversold far quicker than CAD/ZAR and serves as a forward indicator to risk determinations. Short term weekly and monthly risk on / risk off trades are found in AUD/CAD while longer term CAD/ZAR serves well.

Why AUD/CAD wins in the overbought / oversold evaluation is because traditionally it not only trades between CAD/ZAR and EUR/JPY, CAD/JPY but historical price moves from monthly averages barely see a 200 to 300 pip difference while CAD/ZAR changes by 1000’s of pips.

When AUD/CAD topped at 1.0216 in early June and dropped 263 pips to 0.9952, EUR/JPY jumped 221 pips from 122.26 to 124.47 and CAD/JPY skyrocketed 339 pips from 80.84 to 84.23. June saw a rare deviation in CAD/ZAR as it climbed 259 pips from 9,3891 to 9,7488,

Current domination in ZAR is early June’s GDP down minus 0.7%, Manufacturing off by minus 3.7% and 7 of the 10 manufacturing categories tracked for GDP calculations were off. Number 2 Export in Motor vehicles sales currently suffers a 7.2% yearly decrease in new, used and parts accessories. April’s Trade Balance Stats, released in May, revealed Vehicle and Transport Equipment were off by ZAR 2.2 billion, down 18% from February. Overall Trade Balance was ZAR + 5.08 billion thanks to Minerals and metals as all remainder Trade Export categories were negative.

Canada’s Exports rose 14.7% year over year , 3.2% for March and 1.8% for April and led by passenger Cars, light trucks , parts and energy. All 7 of the 11 categories covered by official Global Affairs Canada recorded positive. Overall, Canada’s Trade Surplus Vs the US widened to USD 5 billion in April from 3.4 billion in March and largest surplus since May 2014. The US is Canada’s largest supplier of Agricultural foods to include Vegetables, fruits and drinks.

AUD and ZAR share a relationship in Iron Ore exports especially to China as AUD and ZAR are the world’s largest supplier of Iron Ore.

CAD/ZAR and CAD/JPY’s position in the overall risk assessment for June traded directly to EUR/USD as both CAD/ZAR and CAD/JPY Vs EUR/USD are either ready to cross higher above EUR/USD or severely tumble. EUR/JPY is the laggard pair. See my blog for a picture.

While CAD/ZAR and AUD/CAD describe risk profiles for EUR/JPY and CAD/JPY, the correct view to encompass other currency pairs within the risk parameters is EUR/USD Vs CAD/ZAR because of the constant and widely negative Correlations EUR/USD shares with CAD/ZAR. Think CAD/ZAR as DXY and one may understand the vital import to CAD/ZAR as its a USD pair and opposite to EUR/USD.

Both EUR/USD and CAD/ZAR prices share the widest extremes among currency pairs therefore correct positions for AUD/CAD, EUR/JPY and CAD/JPY are found between EUR/USD and CAD/ZAR. Anytime CAD/ZAR and EUR/USD prices trade close to each other then prepare for a big and long lasting move. Likewise, when wide extremes is the order then again, the big move is on the way. In August 2008 crisis, EUR/USD traded at 1.4100’s to 1.2200 as CAD/ZAR skyrocketed to 20.00’s. Today, EUR/USD trades 1.1100’s Vs 9.7400 for CAD/ZAR. CAD/ZAR’s price is low and EUR/USD price to high. Any pair outside the CAD/ZAR Vs EUR/USD parameters must come back inside the channel.

CAD/ZAR and AUD/CAD are USD pairs yet true commodity pairs and serves the risk off determinations while both pairs provide signals to EUR/JPY and CAD/JPY.

1 month   all pairs


2 months, all pairs, EUR/JPY trades above EUR/USD and far above CAD/ZAR and AUD/CAD.

3 months, CAD/ZAR and EUR/USD close, maybe to close, EUR/JPY hugs CAD/ZAR . AUD/CAD and CAD/JPY low and trades below CAD/ZAR.

6 months. Correct positions CAD/ZAR and EUR/USD. AUD/CAD low, EUR/JPY high.

1 Year, AUD/CAD, EUR/JPY and CAD/JPY trade far above EUR/USD. CAD/ZAR is low.

1 year with addition USD/JPY. USD/JPY is clearly the driver to explain pairs trade above EUR/USD. Must watch for EUR/USD and USD/JPY cross.


Brian Twomey,

EUR/USD and Interest Rate Corridors: Levels, Ranges, Targets


The 5 day volatility Rule after an interest rate rise or fall is traditional and inherent to currency markets on prices. Its a concept never to leave markets but we’ve not seen the effects lately. The best example was seen in NZD as the RBNZ raised and lowered OCR . I suspected this effect as EUR/USD 1.1180’s reported yesterday was not seen for 24 hours. This spoke volumes to the post 2008 currency market consequences.

The lack of volatility addresses interest rate Corridors and the relationships between and among nation’s interest rates. A few examples.

Sept 26, 2008, the Europe Vs USD corridor was 4.52 Europe Vs 1.08 USD for a 3.44 corridor to favor EUR. June 16, 2011, the corridor compressed to favor Europe and EUR/USD at 1.52. What happened was seen in the numbers 1.62 Europe Vs 0.10 USD.

June 16, 2014 another compression materialized by 0.59 Europe Vs 0.10 USD for a 0.99 corridor to favor EUR/USD. July 13th 2012 , The Corridor Favored USD by Europe 0.14 Vs USD 0.19 for a minus 5 basis point corridor. Before Yellen raised Fed Funds, the corridor favored USD by Europe 0.64 Vs 0.91 USD for a 27 basis point difference. After Yellen raised, the corridor widened to roughly 36 basis points. Roughly because Fed Funds 30 day Futures traded and closed yesterday on heavy volume at 0.98. The absolute settlement price for Fed Funds will be known today and it should be the final price to carry us forward in currency prices for days ahead.

Why lack of volatility is the result to marriage in interest rates between and among nations. This concept won’t last forever and one day it will return to see interest rate corridors widen.

What’s the USD/JPY movement dilemma, 0.91 Vs 0.90 JPY and minus 10 today to not favor USD. USD/CAD is favored positively to USD.

3 pairs with the best volatility potential based on Corriors are GBP, NZD and AUD. GBP/USD is negative GBP 70 before the Yellen raise and about 80 after the rise. This explains why the 3 votes to raise by the BOE. UK interest rates and GBP are dangerously low yet UK economics favors leave interest rates alone. Economics must pull GBP from low levels and to raise rates later otherwise the corridors will expand if Yellen raises again. Likewise, USD economics must justify Yellen’s raise or Fed Funds drops and GBP Vs USD Corridors compress from current wides.

Explained was lack of interest rate volatility but not necessarily a guaranteed trade. In the old days of currency markets, good possibility but when Libor was eliminated, nations redesigned interest rate system to manipulate currency prices to their desired advantage. See AUD and the mastery of the RBA as a great example. We don’t trade against the market or market traders as the trade today is trader Vs powerful Central banks.

EUR/USD overall vital support is located at 1.1022. This is the big break line to see a far lower EUR. Far lower means below extremes are located at 1.0600;s as opposed to above at 1.1500;s. EUR/USD at 1.1100’s is almost dead between 1.0600’s and 1.1500. Why higher 1.1200’s provided resistance is EUR was at range tops and lower 1.1300’s was tracking lower on EUR prices.
Previous 1.1300’s is today 1.1254 and a massive resistance point. Below EUR supports are located at 1.1107 and 1.1055. The big break at 1.1022 for today is safe.

USD/JPY big breaks are today 111.25 and 111.73. GBP/USD supports are located today at 1,.2741 and 1.2730. The downside for GBP will become a rough proposition in days ahead.


Brian Twomey

EUR/USD and DXY: Levels, Ranges, Targets

DXY began yesterday at 96.38 and now trades about 97.29 for a 91 pip rise. Seems a muted response to an interest rate hike but from the June 4 post, DXY was far to low at 96.00’s and Fed Funds much to high. Added to DXY’s dilemma is the search for a correlation to Fed Funds as current correlations to 0.91 barely holds a pulse.

Most important monitor to the current raise is watch 30 and 5 year yield spreads and 10’s vs 3 month. So far we’re humped in the middle by about 30 basis points which may partially explain the out of snyc DXY Correlations to Fed Funds. DXY and Fed Funds fails to operate on all cylinders and its rare to see for a central bank on an aggressive path to raise Fed Funds further. The RBNZ’s 3 OCR rate hikes and later 3 lower were easily seen as OCR and NZD/USD correlated perfectly. We’ll take another yield curve read today upon the Fed Funds close as effective rates must be known for an accurate view to answer normalization or an inversion. Inversion reveals rates were unwarranted and its my speculation to the future.

Vital break points for DXY today are 96.72 below Vs above at 97.46, 97.62 and 97.83. Much resistance is built into today’s DXY price which explains severely oversold EUR/USD at 1.1150’s.

EUR/USD break points today are located at 1.1108 and 1.1162. EUR/USD at 1.1160 is not only at bottom range but its oversold. Two break point lines are falling on EUR/USD’s current price: 1.1258 and far above at 1.1312. As stated in the weeklies posted Sunday, EUR/USD can’t handle the upper decks at 1.1200’s. EUR/USD will severely struggle at 1.1270’s and 1.1280’s.

Yet the downside will maintain a slow grind. A sell rally approach to EUR/USD is the way forward. Above longs today will struggle at 1.1180’s. An important aspect to EUR/USD. If the bounce to 1.1180’s is slow and shallow then its known EUR/USD ‘s price is engineered to lower levels.

Brian Twomey

Yield Curve and Spreads


Typically, 5 day volatility is seen in any nation upon an interest rate rise or fall as yields and interest rates normalize to new levels. Fed Funds closed today at 0.91 and failed to reflect the new 1.12 expected level. When the Fed raised December 2015, DXY traded 270 pips from 97.22 to 99.32. The BOJ went negative January 2016 and USD/JPY ranged 286 pips from 115.93 to 118.79. The non example is the RBA cut September 2016 as the RBA slashed from 1.75 to 1.50 in a slow series at 10 basis points each time.

Will we see the traditional 5 day volatility is questioned based on the yield curve. 10 year minus 2 trades 0.79. Then the 30 and 10 trades 0.64. The yield curve is flat from both ends. 10 minus 5’s trades 0.41 and 10 year minus 5’s trades 1.05. Most important is the correct 10 year minus 3 month at 1.11. Fed Funds at 0.91 trades above 10’s and 2’s, 10’s and 30, 10’s and 5’s and below 10 minus 3 months.

The middle portion of the yield curve is slightly humped by 32 and 47 basis points which means either a transition to normal or the yield curve inverts. Fed Funds raises normally experiences a short end rise against a long end drop and means an inversion and guaranteed recession ahead.

The pairs to watch for volatility so far are JPY cross pairs in EUR/JPY and GBP/JPY. NZD always contains great potential as NZD mirrors the USD system. The recommendation is  trade NZD/USD and NZD/CHF together.

Brian Twomey

EUR/USD and G10 Pairs: Levels, Ranges, Targets

GBP/USD’s position is at the day’s low of lows at 1.2723 while EUR/USD faces a break line at 1.1191 and most important at 1.1178. AUD and NZD are located at the day’s upper break points at 0.7592 and 0.7261. USD/JPY remains solid at 109.95 and 109.46 but approaches its break line at 110.57 and 110.65. USD/CHf will see its cap at 0.9728.

Today’s market is treacherous as all pairs are contained within about a 40 pip range to its vital upper or lower break points. USD yields reveal Yellen doesn’t raise while interest rates are on the edge. My analysis remains the same since last August, don’t dare raise as Fed Funds is not only overbought by light years but trading at the 10 year monthly average doesn’t warrant a raise. Nor does economics warrant a raise. If Yellen raises anyway, then Fed Funds reversals will come later. I argued against the last raise due to overbought but Yellen hiked anyway. Then what des a raise mean for GBP and Europe. My guess without running the data is deeply oversold interest rates.

AUD/USD is most tough among the pairs as AUD ontains severe range problems. Supports are located at 0.7535 then comes 0.7529 and 0.7516. Above line break today is 0.7592. Problem with shorts is 0.7578 and 0.7573 must break then rising 0.7535. Yet above to lower 0.7600’s, AUD can’t handle such richter scale levels. Higher for AUD relieves the enormous range pressures but 0.7791 is falling by the day. Bad position for AUD. View my blog for all AUD pairs for the week.

NZD/USD Broke 0.7230 and remains the break line to travel lower. Overbought NZD will see a dead stop at 0.7262. The line to cross below is 0.7209 to target another tough line at 0.7199.

EUR/USD is another pair that can’t handle the upper decks. The big line break is located at 1.1261 but 1.1270 and 1.1280’s will see a brick wall. Below 1.1191 and 1.1178 are big breaks and oversold. Don’t expect breaks down here.

GBP/USD must breaks above are located at 1.2743, 1.2777 then 1.2802 and 1.2832. GBP contains good range and abilities to move today.

EUR/JPY. Watch 123.91 and 123.91 big breaks to target 124.26 then 124.59. The downside is wide open to 123.83. Overall break points to see far lower are located at 122.51 then 121.34.

Brian Twomey

EUR/USD, GBP and JPY: Levels, Ranges, Targets



Posted Sunday GBP/USD support 1.2635, bounced 80 pips from 1.2638.

Ever heard Legacy currency such as DEM/USD. What about the Pegged currency. The British Empire and all nations under its dominion were Pegged to GBP exchange rates. When nations became independent, all established their own exchange rates and money market systems. What was established was a money market system exactly as the UK. AUD for example is the UK system with a slight twist. NZD is the UK system with a slight twist. CAD is born and raised in the UK system. When USD grew up, America went its own way and established a hybrid system as part UK and part its own invention. What changed in 2017, nothing. The names were changed to protect the innocent.

Ronald Reagan left office in 1988. The Republican Party then shifted its ideological focus from conservative Taft and belief small government was best to love of government Teddy Roosevelt. The jury must still decide if Trump is a Reagan/ Taft Republican or Teddy Roosevelt. Appointments on the Republican Party Boards will tell us soon enough.

A voter born in 1988 is today 29 and still young. A vote for America’s Bummer in 2008 was 20 years old. Why would communists in the Democrat Party reveal a hidden and evil ideology when they spent 100 years since Wilson to hide. The Democrats willingly outed themselves as Socialists / Communist in words and policy throughout the last campaign.

What’s the result. The Putsch is on to permanently turn young voters to Democrat orientation in government as solution to all societal ills. The vast majority of the 18 to 25 voters in the T.May election voted to remain in the Eurozone. Benjamin Franklin once said those who vote security over freedom will find neither.

Meanwhile the Democrat disrupt movement continues and young voters in universities are most vulnerable as targets. Ever wonder why American universities don’t offer degrees in American history. The reason is Democrat control of past Civil Service acts. Democrats control the bureaucracy in American governments and created the Education agencies under Carter in 1978. Sad is Google will teach brain surgery and functions of the brain but nobody will use it for simple research.

EUR/USD The big break line for EUR today is 1.1130 but EUR won’t see 1.1130 today. Look for longs at 1.1138 if seen and target back to 1.1157 then 1.1175. The big line break above is 1.1254 but EUR/USD will severely struggle to go higher from 1.1263. EUR maximum today is 1.1279. Shorts the tops to target 1.1244.

Watch EUR this afternoon as it informs the remainder of the week.

Watch GBP/USD 1.2724 break line for a ride to 1.2753. Mind the Gap as 1.2790 is next. Massive supports were instituted by the BOE today at 1.2564 and 1.2630. The new intervention is money market rescues. Its intervention on the cheap.

USD/JPY 109.46 and 109.40 is rock solid. USD/JPY already hit 110.26 and 4 pips above resistance at 110.22. Next up is 110.42 and 110.69. Caution longs as overall big breaks are located at 111.27 and 111.83. Breaks 111.27 and 111.83 is needed to target 112.32.

Brian Twomey

Weekly AUD/USD and Cross Pairs


AUD/USD. Supports 0.7540 and 0.7495. Extremes above 0.7608, 0.7610 and 0.7622. Below 0.7488, 0.7334.

AUD/JPY. Resistance 83.42, 84.37, 85.71. Above to extremes 83.76, 84.03 and 84.26. Below 81.37, 81.32 and 81.23.

AUD/CHF. Resistance 0.7371 and 0.7500. Above 0.7378 to 0.7389. Below 0.7147, 0.7126 and 0.7098.

The smart trade with AUD/USD is AUD/CHF and AUD/EUR.

AUD/CAD Supports 1.0135 and 1.0086. Supports stair step to 9500 and below. Break 1.0135 then 1.0247, 1.0253 and 1.0283. Below 1.0013, 0.9913, 0.9910 and 0.9893.

AUD/NZD. Resistance 1.0592 and 1.0751. Above 1.0543 and 1.0574. Below 1.0387, 1.0364 and 1.0267.


Brian Twomey

Weekly GBP/USD and Cross Pairs: Levels, Ranges, Targets


As GBP/USD’s election drop saw a break at 1.2751 support to now range between 1.2751 and 1.2635, GBP cross pairs became equally affected . GBP/USD trading between vital resistance and support means most widely traded cross pairs GBP/CAD, GBP/AUD and GBP/CHF also trade between vital support and resistance levels. GBP/JPY and GBP/NZD trade far below vital resistance.

What drives GBP/USD prices are averages 5 to 50 day and all are currently oversold. GBP/CAD and GBP/AUD are equally oversold and driven by 5 to 50 day averages while GBP/JPY and GBP/NZD movers are 5 to 200 day averages. GBP/CHF is the outlier as its price is not only severely oversold but current price is located below averages 5 to 253 days. Ironic for medium term mover in the GBP universe GBP/CHF would result from the election drop to become most oversold and to offer best movements. Normally and in order, GBP/NZD, GBP/CAD, GBP/AUD then GBP/JPY offer best volatility on any given day or week.

Inside GBP averages as opposed to EUR is potential against ability to move and to see good volatility for the week. The obvious reason for range ability is the result of both the averages themselves as well as the possibility of the 4th ever Hung Parliament since the elections of 1910. The last Hung Parliament was 2010, 1974 then 1929. The examples are few yet the modern day examples were slated to always become few with passage of the 2011 Fixed Term Parliament Act to hold elections within a 5 year term with ability to call Snap elections anytime. Theresa May had plenty of time on her term to call a Snap Election. All past Hung Parliaments involved a Tory victory against formation of governments with Liberal Democrats. Today appears to be the same phenomenon.

Offered below are GBP/USD and cross pair ranges for the week as well as significant support and resistance points. Tops and bottoms are buy and sell levels while support / resistance points are must breaks to see a more significant move.
GBP/USD Supports are located at 1.2751 and 1.2635. Most extreme prices for the week are located from 1.3030, 1.3064 and 1.3098. The range point is located at 1.3200 therefore 1.2700’s to 1.3200 will hold. Below prices are located at 1.2712, 1.2702, 1.2698 and 1.2675. Bottom prices reveal 1.2635 will hold.

GBP/JPY resistance above is located at 141.35 and 141.91. Upper extremes are found from 144.17 and 144.77. Below begins 139.58, 139.16 and 139.58. GBP/JPY current is well balanced and at the 140 close, GBP/JPY trades below at range bottoms.
GBP/CHF at oversold 1.2300’s meets resistance at 1.2537 and 1.2564. A break of 1.2564 drives GBP/CHF to 1.2607, 1.2629 and 1.2756. At 1.2756 is hardly expected for the week nor anytime soon. Below GBP/CHF will dead stop at 1.2311, 1.2289 and 1.2276.

GBP/CAD is caught between 1.7163 and 1.6988. Oversold, low price and wide ranging GBP/CAD can travel to 1.7610, 1.7678 and 1.7693 before extreme overbought begins. Upper targets are located from 1.7282 to 1.7325. Below prices struggle from 1.7100, 1.7084 and 1.7033.

GBP/NZD is oversold and resistance is located at 1.8019 and 1.8021. A break of 1.8021 then targets to upper extremes are found at 1.8355 and 1.8436. Below price struggles are found at 1.7568 and 1.7509. GBP/NZD remains the granddaddy mover among all currency pairs.

GBP/AUD is oversold and caught between 1.7015 and 1.6763. Above overbought begins at 1.7503 and 1.7638. Below 1.6884, 1.6798 and 1.6765. At 1.6763 will hold as GBP/AUD is at bottoms of its current ranges.

Brian Twomey

Weekly EUR/USD and Cross Pairs: Levels, Ranges, Targets

The common theme in EUR/USD and cross pairs since June 1 is trading quick and short term moves at the 5 and 10 day averages. Overbought / oversold to extremes last week were found from 1.1290’s to 1.1140’s and EUR traded actual from 1.1280’s to 1.1160’s for a 120 pip week. Short term averages lack range therefore ability to move before overbought / oversold severely restricts upward or downward momentum. The result is a dead range trade rather than a trend. The further common theme for this week in EUR, GBP and AUD is participation from the 20 day average yet the overall effects to weekly prices is zero to minimal as the 20 day average lacks any range difference to its 5 and 10 day counterparts.

EUR/USD range indicators reveal a 1.8% variation and confirms not only dead ranges but a low low EUR price overall. EUR is fast approaching bottoms but fighting against EUR and a further explanation to dead ranges is the economic uncertainty derived from both Europe and USD. Is USD economics equally as bad as Europe is unknown. The Fed’s high balance sheet against a desired rise in a severely overbought Fed Funds rate is equivalent to insertion of round object into the square. Then comes the cross pairs.

The cross pairs most affected by EUR/USD are EUR/CHF, EUR/CAD and EUR/GBP. The EUR/GBP price is to high, EUR/CAD to low and EUR/CHF contains severe range problems as its price by SNB standards is always priced below EUR/USD. Higher relieves the pressure in EUR/CHF but then its price becomes overbought. EUR/CAD’s price is most lowest to its counterparts.

The cross pairs not as affected by EUR/USD due to wide ranges by central bank design are EUR/JPY, EUR/NZD and a favorite in EUR/AUD. Most affected means wider allowable movements to its shorter term averages. EUR/AUD by far offers the best trade opportunity for the week.

Offered below are EUR/USD and cross pair ranges for the week as well as significant support and resistance points. Tops and bottoms are buy and sell levels while support / Resistance points are must breaks to see a more significant move.
EUR/USD supports are located at rising 1.1014 and 1.0837. Sell points are located from 1.1281 to 1.1295 while longs are found from 1.1147 to 1.1163. Current EUR/USD is oversold.

EUR/JPY supports are located at 122.56 and 121.23 then above at 126.91 and 128.15. Solid below is 121.23 as bottoms and longs for the week are located at 122.10 and 121.90. Shorts and long targets are located from 125.06, 125.50 and 125.95. At 125.95 is not expected but offered in case Yellen Wednesday offers a non expected statement quip.

EUR/CHF supports are located from 1.0827 and 1.0774. How solid are supports is measured against bottom extreme prices at 1.0807 and 1.0712. Above long targets and reversals are located from 1.0933 to 1.0963 and Wednesday from 1.1005 to 1.1039. Above 1.0963 is not expected.

EUR/CAD supports are located from 1.4825 then 1.4582 and 1.4569. Further supports are located at 1.4322 and 1.4123. How solid is 1.4800 is again measured by extremes below at 1.5004, 1.4991 and 1.4978. Above oversold EUR/CAD will struggle at 1.5220, 1.5254 and 1.5268.

EUR/NZD supports are located at 1.5453 Vs resistance points at 1.5564 and 1.5899. A break of 1.5453 takes EUR/NZD to extremes from 1.5348 to 1.5361 and 1.5369. Overall, EUR/NZD’s price is well balanced.

EUR/AUD supports are located at 1.4697 and 1.4376 Vs above at 1.4898. EUR/AUD will severely struggle to head lower from 1.4664 and 1.4684. EUR/AUD’s price is low yet above dead stops will be seen at 1.5289 and 1.5302. Ranges are wide and mny opportunities exist.

EUR/GBP is least favored as it lacks range, is overbought and its price is to high. Despite the technical short reasons, EUR/GBP is just not making downside progress over last weeks. Supports are located 0.8637 and 0.8577. Above EUR/GBP will find much resistance at 0.8806, 0.8816 and 0.8821. A Yellen fluke could see EUR/GBP hit the Stratosphere at 0.8867 but not expected. Below points include 0.8626, 0.8611 and 0.8578. The support at 0.8578 will hold and 0.8637 will be key for the week.

Brian Twomey  Trade Signals daily and weekly available for interested,

EUR/USD and GBP/USD: Levels, Ranges, Targets


GBP/USD at 1.2700’s now enters the BOE preferred range from 1.2300′ to 1.2800’s and this range point failed to report in yesterday’s verbiage. At 1.2700’s wasn’t enough to move or concern interest rate traders. At 1.2300’s and 1.2400, would ve moved interest rate traders quickly.

At 1.2300’s to 1.2400’s is well well supported and its actually a dangerously and historically low price for GBP. Money market lows enter rates never seen in UK’s history dating to the 1972 free float.

For today and days ahead, 1.2743 and 1.2631 are key levels below while above range breaks are located at 1.2893 and 1.2940’s. Overall range is located from 1.2500’s and 1.2600’s to upper 1.2800’s. At dropping line 1.3200’s will see a further decline in days ahead to sustain the current ranges. Range indicators are well balanced which means GBP won’t experience anymore dramatic moves. A sharp rise above or below can’t sustain itself therefore we should see normalized trading within the new ranges.

Despite the 200 pip election fall, GBP/USD becomes highly oversold from 1.2743 and 1.2631. GBP is oversold from its driving averages 5 to 50 day.

For today, GBP is well supported at 1.2665, 1.2653 and 1.2631. Above, a break at 1.2730 and 1.2743 targets 1.2795.

EUR/US is well supported at its beak point at 1.1135. EUR/USD at 1.1147 to 1.1161 hits not only richter scale oversold for today but EUR/USD can’t hold. Above break point is located 1.1273 and for today the target comes 1.1258 upon a break at 1.1231.

A sincere thank you to Fxstreet’s respected Goncalo Moreira.


Brian Twomey

EUR,CHF,AUD,NZD: Levels, Ranges Targets




UK money markets view today’s elections as a non event and meaningless. I don’t believe money markets care who wins. The Trump victory normally brings ideological counterparts to power and May is the person for the job. GBP today will function as the same old GBP in past days. Focus on the downside today. As long as Brexit negotiations are underway and not complete, BOE to raise interest rates may not be seen until Brexit is settled and until the UK economy comes back to life.

As I read past minutes in succession, the BOE board appears settled to not raise anytime soon. Kristin Forbes term is up June 30 and likely will be replaced by another lefty loonie to vote rate increases meeting after meeting. From 2003 to 2005, Blanchflower and Bean were the lone dissenters on the board and voted meeting after meeting in opposition to majority board members. This is nothing new in BOE land.

The unanswered question for Draghi is bond purchases of 80 billion Euros per month from now to eternity accomplishes what economic goal or is the goal to contain for longer periods Euro at lower levels. What is the overall reason for purchases of 80 billion against an 11 billion M3. Will 80 billion contain interest rate rises long into the future. Questions never answered in research. Inflation should never become the story, GDP higher must be the goal and result. Forget the economic question as any rise in GDP in light of stimulus is a luck stroke from the averages rather than a result to stimulate. Draghi today may promise and forecast economic improvements but it never materializes.

Overbought EUR/USD will struggle to travel higher from 1.1293 to 1.1322. The break point above is 1.1327. We’re selling today 1.1293 to 1.1322 and 1.1327 if we catch it. If Draghi sends prices higher then we have a market sell gift. EUR/USD forcus is on the downside as plenty of daylight exits. First points below are 1.1208 and 1.1202 then 1.1173 and 1.1144. Sell the tops and buy the bottoms.

GBP/USD hits the richter scale at 1.2997 to 1.3022. The break points above are 1.2990, 1.3010 and 1.3042. Any GBP rises is a sell gift. Downside must break 1.2940 and 1.2919 then 1.2899. Overall GBP big break points are located at 1.2759 and 1.2629. Above range break is 1.3155.

AUD/USD must break 0.7542 yet AUD will struggle at from 0.7570’s to 0.7590’s. Focus on downside.

Overbought NZD/USD faces massive resistance at 0.7229. Focus on the downside to 0.7166 and 0.7168.

Oversold USD/CHF should cruise to 0.9675 and 0.9691.

USD/JPY Break points 110.34, target today 110.06. Bottom breaks 109.30 and 109.11.


Brian Twomey

GBP/USD: Levels, Ranges, Targets



GBP/USD target at 1.2952 hit the 1.2971 level then reversed to 1.2910. The significance of this move overall was a result of zero as range breaks are far from 1.2700’s to 1.3100’s. Had this move seen a range break then its a different story to impart a directional bias.
What 1.2971 represented was again an interval move between 1.2952 and 1.2990. At 1.2952 was a perfect target while 1.2971 was the interval above 1.2952. Upon the central bank structural changes last June, its an imperative now to mind the intervals as interval targets are becoming more and more common. Its dangerous to trading and particularly to target traders. The central banks reorganized the trading game. As a further example, 1.2910 was the interval between 1.2890 and 1.2924. Known in regards to 1.2924 was a significant break point for the day which meant remain short upon the break. The must know for any day are the break points.
To add to structural changes and the meaning to current Vs past moves. GBP at 8 am was located at 1.2904 and close to the bottom support at 1.2890. Took GBP 2 hours at 10 am to hit 1.2971. It then took another 2 hours for GBP to trade to 1.2910. A 4 hour trade.
Prior to the June structural changes, today’s trade was done in 2 hours and possibly shorter. We’ve done EUR trades on certain days on a 1 hour candle and walked with 70 odd pips. Against the new changes, the trade today took 4 hours. Overall, the changes slowed the speed of movements. And this applies to all central banks and all currency pairs. Some pairs are affected more than others. AUD/CAD may not see the changes by sight but EUR/JPY was deeply affected to offer a few examples.
Structural change is another topic of no interest to readers but to go further anyway. The central banks offered plenty of warnings as to what was coming therefore I had to adjust strategy in line with the various central banks. What changed was interest rates and therefore the indirect effects to the currency price, targets and intervals. The entire market changed.
Now that the day is done, all former past highs and lows, support and resistance and all the rest what traders follow doesn’t count any longer. But it depends what traders desire for their own trades. I seek perfection due to the challenge and ability to learn.
The new break points are located at 1.2894 and 1.2865 then 1.2928 and 1.2956. Range points are located at 1.3109 and 1.3162. What I’m watching below is current 1.2755 and 1.2620. Until 1.3100’s or 1.2700’s break then GBP is just range trading.

Brian Twomey

GBP/USD: Levels, Ranges, Targets


On paper, GBP/USD ranges appear wide but deception reigns inside GBP. Its a fake news story. While money market traders have a field day trading interest rates, its done at the expense of GBP movements. If GBP triggers don’t materialize on any given day, GBP is not moving and it doesn’t matter what happens within the given day’s trade. GBP is locked down tight. Blame the movements on anything that comes to mind but its never correct. A terrorist attack hardly saw GBP move.
Yields in EUR and JPY are frequently mentioned but never for GBP because UK yields are offered every year from 1 to 30 years. UK even offers a 15 year yield between the 10 an 20. Nobody has a clue what yields to follow. Logical consistency is gonzo from the market people.
In the past 12 hours, GBP ranged from 1.2887 to 1.2921 for 34 pips while the previous 12 hours saw a 42 pip movement. In 24 hours, GBP ranged 50 pips. In the previous 24 hours, GBP ranged 52 pips and broken down by 52 and 49 pips in the 12 hour periods. Without the 1.2950 spike, GBP’s range would’ve recorded far less.
In comparison, EUR/USD drops 58 pips today while GBP roams 27 pips, half the distance to EUR. GBP ranges should be running easily in the vicinity of 70 pips per day and the movements should perform far better than EUR. In days long gone, GBP was always the king of movements but then dimensions were added to money markets to stop GBP.
Overall the 1.3200 line descends on GBP but its a slow mover due to interest rate traders ability to lock down the system. The lines to view in the short term are today’s 1.3105 and 1.3158. Both change by the day but its the vicinity that counts.
Today’s target on the upside is 1.2952 upon a break of 1.2924. Above 1.2952 then GBP heads to not expected 1.2971 and 1.2990. Then always what I call a Fail safe reverse point is issued and traded everyday for all our 10 currency pairs.
On the bottom side, 1.2890 break then 1.2861 comes next followed by 1.2858 and 1.2842. Don’t look for 42 today.
In the larger GBP picture, 1.2753 and 1.2622 are vital supports, Break here then far lower for GBP. Overall, GBP like its brother EUR should consist of a sell rally strategy.

Brian Twomey


EUR/USD, G10 and Interest rates


In Biblical days, interest was charged to foreigners but not to family or household members. Specific rules governed lend, borrow and interest charges. So began the counting system and trade between nations, specifically Greeks, Romans and Hebrews. How Arabs and Persians began the counting system is unknown. The most common number in trade and interest between nations long ago was 5. Its a biblical number as with other bible numbers and vitally important.
Today, the number 5 and multiples of 5 is a premiere number in markets. Its the foundation number to markets, 50 and 100 day MA’s for example. Any wonder a Slow Stochastic indicator is a 3 and 10 MA. In lend borrow, I give 2 and another gives back 3. Easy to count.
2000 years later, Citi Bank and Lehman currency analysts in training manuals focused heavily on currency prices and interest rates in all forms to factor a currency price. All forms means simple interest, compound, equilibrium, interest rates between nations, interest rate rises or reductions in relation to prices. To obtain an ACI Dealing certificate to deal currencies, requires a further in depth ability to know and calculate interest rates and currency prices. Now we’re dealing with Basis points, rollover rates, overnight rates, effective interest rates, time frames such as 1 year, 3 months and much more.
The dealer crowd are ones that beat currency trader / speculators by 20 to 30 pips and the speculators didn’t have a clue they were beat because they weren’t equipped with the same dealer information. Dealers and interest rate/ currency traders understand overbought / oversold, former highs and lows, support / resistance and all the rest of the market jargon in a far different light than currency speculators. The dealers are always correct as they know exactly where to take a currency price but its always in a different location than speculators.
So smart are the dealers, they don’t bother with statistics because interest rates beat Statistics by many miles in day trades. A day trade is defined as 24 hours by dealer standards. Dealers draw from the same well as me: by the central banks as the central banks hand over trades everyday. The key is to grab the easy pips offered rather than focus on the speculators hard pips.
The market is still in short term move mode by trading around 5 and 10 day averages.
EUR/USD is stuck today between its break points at 1.1241 an 1.1296. At 1.1296 becomes overbought an we’re selling back to 1.1250’s and 1.1240’s. Below 1.1241 comes next 1.1226 and 1.1212. We’re long at 1.1212 if we catch it today and trading back to 1.1241. The break of 1.1241 warns of deeper losses in days ahead as EUR began the week and remains far overbought.
The big line break below is located today at 1.1174 but its this area in days ahead to break and see EUR much lower.

NZD/USD approaches overbought and its big break point at 0.7228. AUD/USD is trapped between 0.7474 and 0.7547.

USD/JPY must break 111.51.  USD/CHF caught between 0.9522 and 0.9853.  GBP/USD 1.2745 awaits.


Brian Twomey

Currency Pair Price Targets. June 5 to June 9


   EUR/USD. Sell above and long target = 1.1288 and 1.1316. Long and short target 1.1132, 1.1112 and 1.1095.Currently overbought. Short is the way.
 USD/CAD. Most vital break points below 1.3457 and 1.3416. Oversold currently, long is the way. Sell points and long targets 1.3533 and 1.3535. Long below and short targets = 1.3419 an 1.3409
 USD/CHF. Oversold, long is the way. Most important break points above = 0.9864 and 0.9933. Sell points and long target = 0.9825 and 0.9838. Long and short targets = 0.9612, 0.9580 and 0.9516.
  EUR/GBP. Overbought. Short is the way.  Most important supports below 0.8619 and 0.8564. Sell points and long targets = 0.8807, 0.8818 and 0.8870. Long and short targets 0.8640 and 0.8572.
 AUD/USD. Oversold. Most important break points above 0.7477 and 0.7551. Sell points and long targets = 0.7501, 0.7527 and 0.7540. Short Targets and long points = 0.7363, 0.7360 and 0.7288.
  NZD/USD. Overbought. Short is the way. Most important supports below = 0.7038 and 0.7014. Sell and long targets = 0.7161 and 0.7163. Long and short targets 0.7023 and 0.6977.
 USD/JPY. Most Important breaks to go higher = 111.60 and 112.11. Oversold, long is the way. Sell and long targets = 112.11 and 112.39.
 Long and short targets 109.99, 109.88 and 108.77
  Brian Twomey