EURJPY closed @ 11200 which was BELOW the open and was within prior day's trading range. The High was PRECISELY at Precise Trader's Res Zone 1 and the Low was 135 pips from Precise Trader's Sup Zone 10. The Hourly Oscillators are Turning Bullish and the Price is Below the MA, so the Bears have to be CAUTIOUS. Hourly Trend is Turning Up while 11170 holds and Daily Trend is Corrective Down while 11785 holds, so expect the Price to Turn Up Soon, so the Bears may stay Sidelined and the Bulls get ready to pull the Trigger. The Daily Trend breached the Prior Day's Low but the Bears gave up more than half of their gains towards the Close. The Hourly Trend has been in a Range Trading with an Upside Bias ,11230-11170 are the Critical levels to watch to maintain the Bullish Outlook . On the 5 min is along the steep Up Channel and the Patterns are suggesting that the Price may have bottomed. The Opening Price Principles suggests that EUR is very Strong and the JPY is Weak, so the both the Cross may drag the EURJPY Higher so the Bears must be Sidelined.

BULLS: 11300 11240 11170 BEARS: 11400 11485 11565

Today's Strategies: LONG near 11305 11230 with a tight stop with a 50 pips price target.

GBPJPY closed @ 12885 which was BELOW the open and breached the previous day's low. The High was PRECISELY at Precise Trader's Res Zone 1 and the Low was PRECISELY at Precise Trader's Critical Sup. The Hourly Oscillators are MIXED and the Price is Below the MA, so CAUTIOUS approach is needed. Hourly Trend is Corrective Down while 13105 holds and Daily Trend is also Corrective Down while 13565 holds, so expect the Price to have a Limited Downside and the Bears have to be Cautious. The Daily Trend Plunged Below the Prior Day's Low but the Bears gave up part of their gains towards the Close. The Hourly Trend has been in a Range Trading with an Upside Bias ,13065-13105 are the Critical levels to watch to maintain the Bearish Outlook . On the 5 min is along the gradual Up Channel and the Patterns are suggesting that the Price may bottom Soon. The Opening Price Principles suggests that GBP is Strong and the JPY is Weak, so the both the Cross may drag the GBPJPY Higher so the Bears must be Sidelined.

BULLS: 12935 12860 12775 BEARS: 13025 13105 13185

Today's Strategies: LONG near 12940 12870 with a tight stop with a 50 pips price target.

AUDJPY closed @ 7330 which was BELOW the open and breached the previous day's low. The High was PRECISELY at Precise Trader's Res Zone 1 and the Low was 265 pips from Precise Trader's Sup Zone 10. The Hourly Oscillators are Turning Bullish and the Price is Below the MA, so the Bears have to be CAUTIOUS. Hourly Trend is Turning Up while 7310 holds and Daily Trend is Corrective Down while 8040 holds, so expect the Price to Turn Up Soon, so the Bears may stay Sidelined and the Bulls get ready to pull the Trigger. The Daily Trend Plunged Below the Prior Day's Low but the Bears were holding their gains till the Close. The Hourly Trend has been marching Higher and expect it to continue , 7415-7310 are the Critical levels to watch to maintain the Bullish Outlook . On the 5 min is along the steep Up Channel and the Patterns are suggesting that the Price may have bottomed. The Opening Price Principles suggests that AUD is very Strong and the JPY is Weak, so the both the Cross may drag the AUDJPY Higher so the Bears must be Sidelined.

BULLS: 7430 7345 7305 BEARS: 7530 7660 7740

Today's Strategies: LONG near 7435 7370 with a tight stop with a 50 pips price target.

credit: forexpros

FX Technical Analysis

EURUSD

Comment: A small inverted 'head-and-shoulders' on the hourly chart above underlines the fact the Euro is trying to base against 1.2140, the 50% retracement of its rally from the all-time low at 0.8228 in October 2000 to the record high at 1.6040 in July 2008. A high today at 1.2673, shy of our first target at 1.2700, suggests consolidation between here and the 'neckline' this morning. A weekly close above 1.2800, which might be too much for this week, would add weight to our view that we are trying to form a medium term interim base.

Strategy: Attempt small longs at 1.2595, adding to 1.2500; stop below 1.2200. First target 1.2700.

Direction of Trade: →

Chart Levels:

Support	Resistance
1.2500 "	1.26
1.2455*	1.2673*
1.24	1.27
1.2345	1.2740*
1.2295* 1.2140**	1.28

GBPUSD

Comment: Neither the best nor the worst performing currency this week – which is where you want to be in current market conditions. Cable is still clinging to the 78.6% Fibonacci retracement support in a small sideways consolidation. A weekly close above 1.4550 might buy it a little room to breathe and ought to set off a short squeeze to 1.4750.

Strategy: Attempt small longs at 1.4410; stop below 1.4200. First target 1.4500, then 1.4745.

Direction of Trade: →

Chart Levels:

Support	Resistance
1.4300 "	1.4468
1.4248/1.4238*	1.4522
1.42	1.4550*
1.4135	1.4645
1.4100*	1.4745

USDJPY

Comment: It looks like a 'triangle', it feels like nervous consolidation in a massive 'triangle', it is a continuation pattern. Many are hoping that markets that have suddenly collapsed will find support around this year's lows, the rumour mill suggesting some intervention is likely (Australia) or has been seen (Switzerland). Another nerve-wracking weekend lies in store. What would you do? Live in hope or take defensive action? Bearish momentum is currently stronger than it has been since May 2009 and a weekly close clearly below 88.70 would be very, very negative indeed. Then listen for squeals from the authorities.

Strategy: Sell at 90.25 but only if prepared to add to 91.50; stop above 92.15. First target 89.00, then 88.00.

Direction of Trade: →

Chart Levels:

Support	Resistance
90.00 "	90.37
89.7	90.75
89.35	91.00*
88.95*	91.5
87.95**	91.85

EURJPY

Comment: All too many will be looking at yen crosses and stock indices, pointing out how close we are to this year's lows, fingers crossed that chart support will hold. We disagree and feel we have a nail-biting weekend ahead. Yesterday's large 'spike low' at 109.47 is the lowest point since November 2001 a 75% retracement from the all-time low at 88.93 of October 2000 to the all-time high at 169.97 of July 2008. The chart is looking increasingly like a 'right-angled triangle' – a continuation pattern which suggests another leg lower for the yen crosses. This is a market trading at an extreme and desperately looking for direction while the authorities hope for support. A real tussle which increasingly looks as though it will be resolved with a huge clear-out to the downside.

Strategy: Attempt shorts at 113.35, adding to 114.40; stop above 115.65. Target 112.00, then 110.50 and eventually more

Direction of Trade: →

Chart Levels:

Support	Resistance
112.45 "	114.4
111	115
110.85	115.58*
110.49/110.25*	116.5
109.47* 108.70 106.80*	117

Forex: USD/JPY picks up from 88.95 and reaches 90.00 area

FXstreet.com (Barcelona) - The Yen soared across the board yesterday favored by risk aversion, and the Dollar Yen plunged from 91.85 high to 88.95 low in US session, to pick up on Asian trade, and consolidate between 89.90 and 90.35 ahead of the European session opening.

On the upside, the pair remains capped by session high at 90.35, with next potential resistance areas at 90.85/95 (May 19 high) and 91.20 (200-day MA). On the downside, immediate support lies at 89.95, and below here, 89.60/75 (intra-day support) and 89.30/40 (intra-day support).

EUR/JPY plunged yesterday from 114.00 area to hit fresh 9,5 years low at 109.45 on US session, although the pair has managed to regain all the lost territory, reaching 114.40 high on Asian trade, before pulling back to 113.20 at European opening. Resistance levels are 114.40 and 114.80. Support levels lie at 112.10 and 111.00.

• EUR/JPY
• USD/JPY

EUR/JPY (May 21 at 07:09 GMT)

113.70/73 (2.14%)

H 114.41 L 111.18

S3	S2	S1	R1	R2	R3
112.65	112.94	113.22	113.57	113.85	114.14

[?]Trend Index	[?]OB/OS Index
Slightly Bearish	Neutral
Data updated on May 21 at 06:58 (15-minute timeframe)

[ View EUR/JPY technical studies ]

Did Central Bank Intervene On EUR?

After once again plummeting to fresh 4 year lows yesterday the euro regained some footing during trade although this is likely to prove to be short lived.

Euro strength was based on rumours, both unfounded, that a) the ECB was leading a coordinated effort of euro buying to bid up the price and b) that Greece was considering leaving the EU. One central bank that was happy to intervene was the Swiss National Bank who jumped into the market to sell the franc against the euro with EURCHF moving from 1.40 to 1.43 in a matter of minutes. This had the effect of strengthening the euro against its other crosses pushing EURUSD up into the 1.23s and GBPEUR down to the low 1.16s.

As I said, this euro strength is unlikely to remain for long as every trade recommendation on EURUSD that I’ve seen from banks and hedge funds is to ‘sell spikes’ i.e. to short little pop-ups like this.

GBP was dragged higher against the dollar as the risk atmosphere improved in light of the euro’s appreciation. This was in spite of a fairly poor set of minutes from the Bank of England. While the view was indeed a 9-0 consensus, the markets are still somewhat shifty about how the Bank of England will walk the tight-rope between dealing with our high inflation levels and still allowing the recovery to flourish.

Markets did remain volatile for the rest of the day as investors dealt with the repercussions of the German ban on ‘naked’ short-selling. Equity market futures suggest a positive open for the FTSE and other European markets this morning however.

Interesting day for the pound looking forward today with our retail sales measure at 09.30. We expect this to be roughly positive as the effect of the improving weather is balanced out by people waiting until after the election to make large purchases. The consensus view is 0.3%. We also have a UK debt auction with the DMO selling UK 2020 bonds at a vield of 4.75%. given the recent concerns over the UK’s ability to raise funds in the market the bid-to-cover ratio will be a useful barometer of how the market perceives the UK.


Latest Exchange Rates At Time Of Writing (Back by Popular Demand)
Indicative Rates Sell Buy
GBPEUR 1.1550 1.1579
GBPUSD 1.4346 1.4370
EURUSD 1.2405 1.2426
GBPJPY 131.04 131.35
GBPAUD 1.7238 1.7265
GBPNZD 2.1116 2.1153
GBPCAD 1.5078 1.5110
NZDUSD 0.6780 0.6799
GBPZAR 11.19 11.24
USDZAR 7.7969 7.8311
GBPPLN 4.7474 4.7858
EURJPY 113.25 113.51

Rates are dependent on amount transacted.

Source : fxstreet.com

EUR/USD: Bullish Engulfing and Approaching Important Level

The last few days I have talked about a reversal. Not a "catch a falling knife" trade, but I do expect a bounce at some point and with major lows taken out and a rally back above, it appears prudent to be aware of a potential reversal and not get married to the short.

Yesterday I mentioned 1.2450 as a level that if surpassed could trigger some bullish action. I does not mean a straight up shot after that, but it would indicate that the Euro is seeing some more aggressive buyers coming in. On Wednesday we approached that level on a significantly strong day for the EUR which produced a bullish engulfing pattern.

The pair currently trades at 1.2392. Failure to get above 1.2450 is bearish as this is the former swing high. Support in this case comes in between 1.2250-1.2225 and 1.2150.

1.2450 is a resistance a level but a move beyond could trigger further buying into 1.2515. Beyond this resistance comes in at 1.2580-1.2600.

Euro Continues to Unwind

There was further selling on Tuesday in the Euro as support and prior lows were taken out. The trend remains down on all time frames. I am still watching for moves above resistance for signals of a reversal, yet breaks below support should also also be traded as that is the current trend.

With the additional selling seen on Tuesday, it will take a move 1.2450 to indicate any bullishness which has a chance of being sustained.

Resistance is at 1.22 followed by 1.2230-1.2250. Resistance beyond is at 1.2280 and 1.2310.

On the downside, support is at 1.2150 with a slide below indicating further selling and a short-term target of 1.2100 and 1.2050.

Cory Mitchell, CMT

Trader of the year 2010 Championship

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