Daily Market Technicals

FX Outlook

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

EUR/USD consolidating at Fibo support

Todays outlook: Weekly outlook:
Daily EUR/USD Chart
Comment: EUR/USD has again seen another counter trend move. Upside momentum has fizzled out at 1.4537and focus has again shifted to underlying support. The 38.2% retracement support at 1.4270 is being tested. We will need a close below here to alleviate upside pressure and concentrate efforts on supports this would target 1.4185, then 1.4020/00 en route to the 200 day ma at 1.3928. While no close below 1.4270 is seen, we remain unable to rule out stabs higher. Intraday rallies are expected to find nearby resistance at 1.4440 and will remain slightly offered below here. Above here will re-focus attention on to the 1.4537 recent high then the 1.4580 early July high en route to 1.4694/1.4704, where we look for the rally to fail. Todays trade: Longs stopped. Attempt tiny longs at market, add 1.4270, stops 1.4250. Cover 1.4520. Shorter term (1-3 weeks): Downtrend eroded, target 1.4694/1.4704. Medium term (1-3 months): To remain below the 1.5000/1.5145 region. Targets 1.3748/13 (2010-2011 uptrend and 55 week ma), then 1.20. Current Price: 1.4344

Support 1.4311 1.4270* 1.4187* 1.4015 1.3968*

Reason 55 day ma Fibo Minor Fibo Low 18 July May trough

Resistance 1.4520/37 1.4580** 1.4647 1.4696** 1.4704**

Reason Early July high Recent high 78.6% Fibo

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

USD/CHF continues to sit on .8000

Todays outlook: Weekly outlook:
Daily USD/CHF Chart
Comment: USD/CHF no change has held over the .8000 support area (psychological support) all week we favour a bounce. We have an additional support line cutting in at .7949, which connects the lows since March and ideally we would like to see a rebound from here today. Initial resistance is found at the near term resistance line at .8109 ahead of .8276, the June low and the downtrend at .8344.. Below .7949, the major support is not encountered until 0.7450, the 33 year support line (connects lows from 1978). The base of the 2011 channel cuts in at .7750. We also have a point & Figure target of 0.77. Todays trade: Long .8018 stops below .7965. Cover .8200 Shorter term (1-3 weeks): Probing the .8000/.7975 support Medium term (1-3 months): Look for signs of stabilisation around the .80 mark. Current Price: 0.8002

Downtrend at .8344

Support .8000/.7997** .7949 .7965 .7750/40 .7439

Reason Low Support line TD supportChannel SL

Resistance .8109 .8276/79** .8327* .8364 .8344**

Reason Resistance line June low Early June low th 6 July low Downtrend
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Karen Jones | Technical Analysis Research | Friday, 29 July 2011

GBP/USD consolidating above support at 1.6260

Todays outlook: Weekly outlook:
Daily GBP/USD Chart
Comment: GBP/USD is consolidating above 1.6260, the end of June high and lows for end of July. While above here we maintain scope for gains to 1.6540/47, the 78.6% retracement of the move down from the April peak and the May peak. This is considered to be the last defense for the 1..6745/90 April peak and 200 week ma.. Below 1.6260 we would allow for a slide back to the 55 day ma at 1.6204 only below here does the chart picture turn more negative and re-focus attention on 1.6068 (200 day ma). Todays trade: Long 1.6265, raise stops to below 1.6260. Partially cover 1.6525, looking to reverse longs on rallies to 1.6745/90 tight stops Shorter term (1-3 weeks): Break of near term resistance targets 1.6395 then 1.6745/90. Medium term (1-3 months): Neutral to slightly positive allow for retest of the 1.7050 pivot which is expected to provoke failiure. Support at 1.6265/60 Current Price: 1.6347

Support 1.6260/65 1.6204* 1.6165/30 1.6068* 1.6000*

Reason End July high 55 dma Minor Fibo 200 dma Psych support

Resistance 1.6472 1.6540/47** 1.6740/45** 1.6768** 1.6877*

Reason 7 June high June high April peak 200 week ma Sept. 2009 high

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

USD/JPY under pressure

Todays outlook: Weekly outlook:
Daily USD/JPY Chart
Comment: USD/JPY has again inched lower and again, its new low has not been confirmed by the daily RSI and some caution is warranted. We note various Elliot wave counts on intraday and daily charts imply the market is either at or close to a low. We have minor support ay 77.30/25 and this is the last defence for the 76.25 low. A negative bias remains. Minor resistance is found between the May and June lows and the 61.8% Fibonacci retracement at 79.57/88 and around the psychological 80.00 mark and the market will need to regain this in order to alleviate immediate downside pressure. Todays trade: Attempt tiny longs at market, add 77.00, stop below 76.25.Cover 79.50. Shorter term (1-3 weeks): Is focused on support. Medium term (1-3 month): Neutral to negative. Must clear 4 year downtrend at 82.55 for any recovery to be viable. Current Price: 77.54

Support 77.57, 77.29 76.25** 75.00* 74.73* 73.90

Reason March low Psych. support 2009-2011 supp line

Resistance 79.57/88* 80.00* 80.74 80.36 81.14

Reason May/Jun low&Fib Psych. resistance Cloud 55 dma. 100 dma

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

EUR/JPY negative bias below the 113.62/114.00 resistance.

Todays outlook: Weekly outlook:
Daily EUR/JPY Chart
Comment: EUR/JPY remains under pressure and the market looks set to drift lower, following stubborn rejection at the 113.63/985 resistance (200 day ma). Key near term support is the 110.10/109.58 area, which represents the 78.6% retracement and the recent low and we suspect that this will again hold. This is seen as the last defense for the January and March 106.83/50 troughs. We would need to see a close above 114.00 to alleviate immediate downside risk and signal a recovery to the 116.11 3 month resistance line. Todays trade: Shorts from 112.85, covered 112.05.Resell 112.25, 112.85, stops over 113.65. Cover 110.10. Shorter term (1-3 weeks): Break down from range targets 110.10, then 108.90. Medium term (1-3 months): Based at 106.50/105.45. Current Price: 111.20

Resistance line at 113.63

Support 111.44 110.66 110.10** 109.58 108.90**

Reason Low 18 July 78.6% Fibonacci Tuesdays low Measure target

th

Resistance 113.33 113.40/50* 113.62** 114.00** 114.92

Reason 55 week ma May & June lows Resist line 200 dma 50% retracement

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

EUR/GBP stalled at the 38.2% Fibo retracement at .8850

Todays outlook: Weekly outlook:
Daily EUR/GBP Chart
Comment: EUR/GBP has sold off following its failure to register a close above the 38.2% retracement resistance at .8850 (of the move down from the July peak). Further consolidation is likely but we suspect that last weeks low at .8712/06, was an interim low and we look for further stabilisation here. We would allow for a move back towards .8977/.9000 (mid June high). Only below .8700 will re-engage the 200 day moving average at .8667 and introduce potential to .8612 then .8533, the four year uptrend line. Todays trade: Attempt tiny longs on dips to .8728, 12, stops below .8706. Cover .8977. Shorter term (1-3 weeks): Attempting to stabilise above .8700. Medium term (1-3 months): View has been neutralised. Current Price: .8768

Support .8723** .8712/06** .8675* .8666* .8640*

Reason 16 June low Fibo + rec low th 12 May low 200 dma 5 month SL
th

Resistance .8850 .8890/95 .8941** .8977 .9042**

Reason Minor fibo Oct 2010 high June high May high

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

EUR/CHF looking for market to stabilise 1.1450-1.1358

Todays outlook: Weekly outlook:
Daily EUR/CHF Chart
Comment: EUR/CHF has again eased off, to leave the outlook unchanged, very near term it is on the defensive but we look for recent lows at 1.1365/58 to hold. It should be noted that we suspect the low is in place for now as the market has recently reversed from a long term Fibo support at 1.1358 and we look for this rebound to retest the 55 day ma and then reach 1.1946/1.2000 as a minimum. Intraday rallies will find resistance at 1.1700. Todays trade: Holding tiny longs 1.1465 stops below 1.1350. Cover 1.1800. Shorter term (1-3 weeks): Should recover to downtrend. Medium term (1-3 months): We suspect the market is basing at 1.1364/58 Previous low at 1.1808 Current Price 1.1480

Support 1.1475/50 1.1410 1.1365** 1.1358 1.1290

Reason Minor Fibo Low Fibo extension 240 min P+F

Resistance 1.1700, 1.1770 1.1808** 1.1946* 1.2000 1.2053

Reason June low Mid-June low Psych. resistance Early June low
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Karen Jones | Technical Analysis Research | Friday, 29 July 2011

Other technical analysis reports we publish are:

Monday: Tuesday: Wednesday: Thursday: Friday: FX Emerging Markets Technicals, Strategic Technical Themes; Bullion Weekly Technicals; Commodity Weekly & Commodity Currencies Weekly Technicals; technical contribution to the Emerging Markets Bi-Weekly; Fixed Income Weekly Technicals.

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

Explanation:

This technical analysis report is based primarily on Dow theory and is using bar and candlestick charts. Support and resistance levels with no asterisk denote minor levels. One asterisk denotes an area of reasonable support or resistance, two stars are for strong areas of support or resistance. Uptr = Uptrend, connecting 3 low points. SL = Support line. Support lines have only 2 points of contact and are not as important as uptrends. Dtr= Downtrend, connecting 3 high points. RL = Resistance line. Resistance lines connect only 2 high points and are not as important as downtrends. Fibo = Fibonacci retracement we use the 23.6%, 38.2%, 50%, 61.8% and 78.6% levels. Fibox = Fibonacci extension we use the 61.8%, 78.6%, 100%, 138.2%, 161.8% and 261.8% levels. Pivot point = an area on the chart which acts as both support and resistance. St = Short term level (for example St Fibonacci retracement refers to the nearest highs and lows) Lt = Long term level (for example Lt Fibonacci retracement refers to longer term highs and lows) 55 dma = 55 day (simple) moving average 200 wma = 200 week (simple) moving average

Karen Jones | Technical Analysis Research | Friday, 29 July 2011

Disclaimer
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Karen Jones | Technical Analysis Research | Friday, 29 July 2011

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Karen Jones | Technical Analysis Research | Friday, 29 July 2011

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Karen Jones
Head of FICC Technical Analysis Tel. Mail +44 207 475 1425 karen.jones@commerzbank.com

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Karen Jones | Technical Analysis Research | Friday, 29 July 2011