7 Dec: Forecast: FX: US$/Majors + trade ideas

By | December 7, 2017


EURUSD: 1.1792
€/Usd is a little lower having traded a 1.1780/1.1847 range and is currently sitting right on the 100 DMA which may act as a magnate today although the short term momentum indicators hint at lower levels ahead.
1 hour/4 hour indicators: Turning lower Daily Indicators: Possible topping formation Weekly Indicators:  Neutral
Preferred Strategy:  The short term momentum indicators look a little heavy again on Thursday, so selling rallies may be a plan today while not looking for too much ahead of Friday’s NFP figure.  I remain neutral on the Euro, although the daily charts, which had been leaning higher appear to be running out of steam and may be hinting of further dollar strength ahead. Look to trade 1.1760/1.1830 today.
Resistance Support
1.1890 Chart Gap 1.1780 Session low
1.1877 4 Dec high 1.1775 55 DMA
1.1847 Session high 1.1755 (50% of 1.1553/1.1943)
1.1825 Minor 1.1707 (61.8% of 1.1553/1.1943)
1.1800 100 DMA 1.1685 Rising trend support

Economic data highlights will include:                                                                                

EU GDP, US Jobless Claims, Consumer Credit Change, ECB Draghi Speech

USDJPY: 112.29
US$Jpy is a bit lower on Thursday with year-end demand for the Yen negating the US$ strength seen elsewhere.
1 hour/4 hour indicators: Mixed Daily Indicators: Turning higher Weekly Indicators:  Neutral
Preferred Strategy:  As before, a nimble stance is required, with the short term momentum indicators looking a mixed, while the dailies are leaning slightly higher now and buying dips is preferred for the medium term. Look for a range of 111.65/112.80 to cover it today, with further consolidation likely ahead of the US Jobs report, Friday. A break of good support at 111.60 may lead to stops being triggered and lead the dollar back towards 110.85/111.00 although I don’t see it happening today.
Resistance Support
113.50 Minor 111.98 Session low
113.20 (61.8% of 114.73/110.83) 111.60/65 100 DMA/200 DMA
113.08 4 Dec high 111.35/39 29 Nov low /1 Dec low
112.85 5 Dec high 111.00 Minor
112.62 Session high 110.83 27 Nov low

Economic data highlights will include:

Leading Economic Index, Coincident Index, Foreign Bond/Stocks Investment

GBPUSD: 1.3387
Cable fell to a 1 week low of 1.3358  amid Brexit uncertainty, ending the US session at 1.3375 and looking mixed heading into Thursday
1 hour/4 hour indicators: Mixed Daily Indicators: Possible topping formation.                                                                     Cable fell to a 1-wk low at 1.3358  amid Brexit uncertainty, ending NY 1.3375 Weekly Indicators:  Turning higher?
Preferred Strategy:  It looks set to remain choppy for Sterling, with Brexit headlines likely to guide the direction. A neutral stance is required although further dollar strength would seem to point to slightly lower levels for Cable, where targets would be at 1.3350 and then at 1.3300. In the meantime, stand aside.
Resistance Support
1.3538 4 Dec high 1.3357 Session low
1.3500 Minor 1.3352 (38.2% of 1.3038/1.3549)
1.3480 5 Dec high 1.3325 Minor
1.3443 Session high 1.3295 (50% of 1.3038/1.3549)
1.3400 Minor 1.3280 Minor

USDCHF: 0.9900
US$Chf has traded up to 0.9910 and looks set for further gains in the coming session although I think it will be generally fairly steady ahead of tomorrow’s US Jobs data
1 hour/4 hour indicators: Turning higher Daily Indicators: Turning higher Weekly Indicators:  Neutral
Preferred Strategy:  With both the short term and daily momentum indicators looking constructive we could see a run back to 0.9940/50 and possibly to 1.0000+.

Buy US$Chf @ 0.9880. SL @ 0.9840, TP @ 0.9980.

Resistance Support
1.0000 Psychological 0.9854 Session low
0.9975 Minor 0.9835 100 WMA /5 Dec low
0.9946 21 Nov high 0.9805 200 DMA
0.9910 Session high 0.9783 Chart Gap
0.9895  (76.4% of 0.9946/0.9776) 0.9735 1 Dec low /100 DMA

AUDUSD: 0.7563
AudUsd is lower on Thursday having traded heavily all day following the volatile price action seen after the release of yesterday’s GDP. Having been unable to regain 0.7600 following the data release, the Aud has traded down to a low of 0.7558. Currently trading just above the lows, the momentum indicators suggest that 0.7550 will be given a nudge, below which would open 0.7530, 0.7515 and possibly the rising trend support at 0.7485.
1 hour/4 hour indicators: Turning lower Daily Indicators: Up – Turning Neutral? Weekly Indicators:  Turning lower
Preferred Strategy:  Trading from the short side continues to be the plan ahead of next week when the Fed is expected to hike rates. I therefore suspect that further upside for the Aud will be limited and selling into rallies is still preferred.

Sell AudUsd @ 0.7585. SL @ 0.7610, TP @ 0.7490

Resistance Support
0.7665 13 Nov high /(23.6% of 0.8102/0.7531) 0.7558 Session low
0.7653 5 Dec high 0.7550 1 Dec low  /100 WMA / (61.8% of 0.7159/0.8124)
0.7630 Session high 0.7531 21 Nov low
0.7595 200 HMA 0.7515 (76.4% of 0.7328/0.8124)
0.7575 Minor 0.7500 Minor

Economic data highlights will include:                                                                           

AIG Services PMI, Trade Balance, China Foreign Exchange Reserves

NZDUSD: 0.6876
The Kiwi squeezed up to 0.6916 on Thursday before heading lower once again to finish the session just above the low of 0.6954.
1 hour/4 hour indicators: Neutral – Turning lower? Daily Indicators: Turning higher Weekly Indicators:  Turning lower
Preferred Strategy:  The short term momentum indicators are neutral, possibly turning slightly lower and a cautious stance is required on Thursday. The dailies remain mildly positive but with the weeklies looking heavy, I still prefer to look for levels to sell into, for an eventual return to the downside, where 0.6780/6800 would provide decent support. For today, a range of 0.6900/0.6820 might cover it.
Resistance Support
0.6945 28 Nov high 0.6869 Session low
0.6933 (23.6% of 0.7434/0.6783) 0.6850 5 Dec low
0.6928 29 Nov high 0.6840 4 Dec low
0.6916 Session high 0.6816 1 Dec low
0.6885 Minor 0.6779 17 Nov low