FOREX Tech Targets

EUR/USD: Neutral (since 07 Aug 17, 1.1785): Bearish if NY closing below 1.1680

EUR dipped below the strong 1.1680 support and touched a low of 1.1661 yesterday before staging another strong rebound. As highlighted in the past couple of updates, EUR has to close below 1.1680 to indicate that it has moved into a bearish phase. While the probability for this scenario is not high at this stage, it would remain intact and continue to increase unless EUR can move and stay above 1.1790. A shift to bearish phase would have an immediate target of 1.1580. 

GBP/USD: Bearish (since 07 Aug 17, 1.3045): Room for extension lower to 1.2775. No change in view (see update from yesterday below). 

Despite the lack of a ‘follow-through’ after the break of the major 1.2850 support (GBP eked out a fresh low of 1.2842), it is too early to expect a short-term low. Only a move back above 1.2970 would indicate that the bearish phase that started last Monday, 07 Aug, (spot at 1.3045) has ended. In the meanwhile, we could see a couple of days of short-term consolidation before the next leg lower even though any decline is expected to encounter solid support at 1.2775.

AUD/USD: Neutral (since 18 Aug 17, 0.7925): Immediate upward pressure but 0.7980 expected to offer solid resistance.

We turned neutral on AUD yesterday and were of the view that the immediate upward pressure could carry it higher but the 0.7980 level is expected to offer solid resistance. AUD hit a high of 0.7962 but the up-move was quickly reversed. From here, as long as 0.7850 is intact, another attempt to test 0.7980 is not ruled out even though the odds for such a move have diminished after the sharp pull-back yesterday. A clear move back below 0.7850 would increase the risk of a break of the major support near 0.7805 (rising daily trend-line support which coincides with the 0.7806 low seen earlier this week). 

NZD/USD: Neutral (since 17 Aug 17, 0.7310): In a 0.7240/0.7370 range.

We just shifted from a bearish to neutral stance on NZD yesterday and there is no change to the view. NZD is deemed to have moved into a neutral consolidation phase, expected to be between 0.7240 and 0.7370. Looking further ahead, a clear break below 0.7240 would increase the odds of a sustained move below the major 0.7205 support. 

USD/JPY: Neutral (since 15 Aug 17, 110.10): In a 109.20/111.05 range.

After coming close to the top of the expected 109.20/111.05 consolidation range two days ago (high of 110.94), USD is currently approaching the bottom end of the range. The volatile price action was not exactly expected and looking further ahead, the downside appears to be more vulnerable and would continue to remain so unless USD can reclaim and stay above 110.00 within these 1 to 2 days. That said, only a clear break below last week’s 108.73 low would indicate that USD has moved back into a bearish phase (with an immediate target of 108.10). 

Source: efxnews.com