15 Oct: Trend table outlook for FX, Commodities, Indices

By | October 15, 2019

The trend table is showing very little on Tuesday and a cautious stance is required. Once again it seems to be that it will be headlines coming from the US/China regarding the trade outcome that will provide any directional move. The China CPI and the RBA Minutes are both due in Asian trade, which may create some waves, while Brexit talk and then, later on, the start of the US corporate reporting season will be the main focus.

In the meantime, I would not be too involved today, and a rangebound session may lie ahead, so choosing a range and leaving the appropriate SL on either side may be the plan.

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*Trade of the day: October 15, 2019; 7:31 AM(AET)                         

*This is a personal opinion only, based on the look of the table below, and carries no guarantee of success.

All trades are good till 5.00pm NY time. All “in the money trades” should have the SL raised to break-even, or managed manually. All “out of the money trades” should keep original SL in place.

Sell EurUsd @ 1.1070. SL @ 1.1105, TP @ 1.1000

Buy EurUsd @ 1.0985. SL @ 1.0945, TP @ 1.1080

Sell AudUsd @ 0.6800. SL @ 0.6835, TP @ 0.6730

Buy AudUsd @ 0.6720. SL @ 0.6690, TP @ 0.6785

Buy GbpAud @ 1.8400. SL @ 1.8200, TP @ 1.9000

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EurUsd:  The Euro has traded a quiet, sideways range of 1.1011/42, below the Friday high of 1.1062, where it ran into the base of the daily cloud and the weekly Kijun and which will continue to provide strong topside resistance. The short term momentum indicators are mixed and currently show little directional bias although the medium term momentum indicators look constructive so we could eventually see a return to 1.1060. Beyond the strong resistance Ichimoku resistance, the September 18/19 highs sit at 1.1072/75 and come ahead of the Fibo level at 1.1080 (38.2% of 1.1411/1.0878) and the 13 September high at 1.1109. A break of this level would add upside momentum and could then see a test of the 100 DMA at 1.1145, and eventually the 61.8% Fibo level at 1.1205 and the 200 DMA at 1.1215.On the downside, support will be seen at 1.1000/10, below which would open the way to 1.0965/70 (minor) and then to 1.0940 (8 Oct low). I don’t think we go close to this for a while, but if wrong, below 1.0940 would allow for 1.0900, a break of which would then open the way back to the 1.0879 low. Further out, we could eventually see a run towards the next target at 1.0860(76.4% of 1.0340/1.2555), and then to the 23 April 2015 low at 1.0820. A break of this would find a weekly chart gap that would take us to 1.0775 but don’t get excited about this any time soon. A range of 1.0980/1.1070 may be the idea today.

 

US$Jpy:   traded a sideways 108.05/51 range on Monday, but below Friday’s high of 108.62 as risk sentiment turned a little more cautious on the back of some Chinese reports that seemed to put any trade deal further apart than was thought on Friday. The short term momentum indicators are now in neutral although the longer term charts still look constructive and may even be building a reverse head shoulder base, with a possible target of around 112.50 although that remains a long way off, and will only come about if there are some very positive headlines from the US/China. In the meantime we need to break above 108.60/65, which would then open the way to 109.05 (100 DMA) and to 109.30, which will be strong resistance if/when we get there (1 August high, 61.8% of 11.40/104.45). Further out, we may look towards 109.92 (30 May high) and, above 110.00, to 110.50 (76.4%). On the downside, minor support will be seen at 108.00/10 (23.6% of 104.45/108.62). Below this sees 107.80 (23.6% of 104.45/108.62) come into play, a break of which opens the way to 107.53 (50%), the 200 HMA at 107.40 and to 107.30 (61.8%). For the time being, buying dips seems to be the plan, with a SL below the Fibo level at 107.80.

 

AudUsd:  The change in sentiment weighed on the Aud$ on Monday and saw a retreat back to 0.6750 ahead of a late squeeze back to 0.6775, where it currently sits, leaving the outlook as rather neutral. On the topside, resistance will be seen on the approach to 0.6800 and again at the Friday high/minor Fibo level at 0.6810 (61.8% of 0.6894/0.6770). Beyond that, the targets to watch would be at the larger Fibo level at 0.6828 (38.2% of 0.7081/0.6770), 0.6840 (76.4% of 0.6894/0.6770) and 0.6876 (50% of 0.7081/0.6770), above which could then stretch to the 12 September high at 0.6894 and eventually to 0.6925 (61.8% of 0.7081/0.6770). The RBA Minutes are due today and may creates some volatility, but  note that we are now back in the daily cloud – just (see chart), meaning that we may see a few days of messy, choppy trade. On the downside, bids would again arrive at 0.6750 (/200 HMA) beyond which could then allow a drift back towards 0.6730 and to 0.6700.  Further out, I still think we may eventually see lower levels for the Aud$ and if/when we go back below 0.6700 Fibo extension support would arrive at the 0.6670 low, which will be very strong, but a break of which would then head towards 0.6638 (76.4% of 0.6894/0.6670 from 0.6810)  ahead of 0.6600. Under here would allow for a move to 0.6585 (100%) and eventually to 0.6500 although that remains some way off. In the big picture, the next major Fibo support level on the monthly chart is not seen until 0.6250 (76.4% of 0.4773 (April 2001)/1.1082 (July 2011).

                                   

NzdUsd: The Kiwi ran out of steam at the Friday high of 0.6353 and has since seen a steady drift lower through Monday trade to where it currently sits, just below 0.6300. Right now, a choppy session looks likely, with sellers likely to arrive at 0.6305/15 (100 HMA/200 HMA), above which could return to 0.6330 and even to 0.6350/55 (0.6355 = 61.8% of 0.6449/0.6203), at 0.6391 (76.4%) and at the 12 Sept high at 0.6450. On the downside, support will be seen at the session low, at 0.6281, below which would open the way for further losses towards 0.6255/60, 0.6220 and possibly back to the 0.6203, 4 year low. In the distance, on a break of 0.6200, there is little to hold the Kiwi up , but more distant bids would arrive at the August 2015 low at 0.6125.