9 Oct: Forecast: FX: US$/Majors + Trade Ideas

By | October 9, 2017


EURUSD: 1.1733
Preferred Strategy:  While the short term momentum indicators are now suggesting the chance of a near term recovery for the Euro, the longer term charts are still hinting at lower levels ahead. A US holiday today may dampen enthusiasm to get too involved but the political situation in Spain may cap any upside momentum.  In the bigger picture, the H/S target remains at around 1.1560. Sell EurUsd @ 1.1780. SL @ 1.1830, TP @ 1.1650.
24 Hour: Neutral – Prefer to sell rallies Medium Term: Mildly Bearish
Resistance Support
1.1800 Minor 1.1700 Minor
1.1785 4 Oct high 1.1669 Friday low
1.1770 (23.6% of 1.2091/1.1669) 1.1661 17 Aug low
1.1755 200 HMA 1.1650 Minor
1.1738 Friday high 1.1612 26 July low

Economic data highlights will include:

M:  US Holiday, German Industrial Production, EU Sentix Investor Confidence Survey

T: German Trade Balance, Current Account, API Weekly Crude Oil Stock Inventory

W:  FOMC Minutes

T:  EU Industrial Production, US PPI, Monthly Budget Statement, Jobless Claims, EIA Crude Oil Stocks Weekly Change

F: German CPI/HICP, US Retail Sales, CPI, Michigan Consumer Sentiment Index, Business Inventories, Baker Hughes Oil Rig Count

USDJPY: 112.64
Preferred Strategy:  The dollar briefly made a new trend high on Friday (113.43) before reversing to fish the day pretty much unchanged and within the recent range. Short term charts are fairly neutral although the dailies are showing signs of some tiredness on the topside and we could see a bit of a dip in coming sessions although being a US/Japan holiday it looks like being a fairly quiet Monday. Trade the range 112.00/113.00 with a 40 point SL on each side.
24 Hour: Neutral Medium Term: Neutral
Resistance Support
113.55 Minor 112.63 Friday high  low
113.43 Friday high 112.40 5 Oct low
113.20 Minor 112.32 4 Oct low/29 Sept low
113.00 Minor 112.20 27 Sept low
112.70 200 HMA 112.05 (23.6% of 107.31/113.43)

Economic data highlights will include:

M: Japan Holiday

T: Trade Balance, Current Account-Eco Watchers Survey, Machine Tool Orders

W:  Machinery Orders,


F: Foreign Bond/Stocks Investment

GBPUSD: 1.3064
Preferred Strategy:  Cable remains heavy because of the turmoil in the Conservative Party and looks as though it has further downside potential although the short term momentum indicators are reaching oversold status. For the time being it is best to stay square, but looking to sell rallies would seem to be the plan as a test of 1.3000, and lower, would seem to eventually be on the cards. Sell GbpUsd @ 1.3100. SL @ 1.3175, TP @ 1.3000.
24 Hour: Neutral Medium Term: Prefer to sell rallies
Resistance Support
1.3174 (23.6% of 1.3656/1.3026) 1.3050 Minor
1.3145 Minor 1.3026 Session low
1.3120 Friday high 1.3010 100 DMA
1.3100 Minor 1.2995 (61.8% of 1.2588/1.3656)
1.3080 Minor 1.2980 (76.4% of 1.2773/1.3656)

Economic data highlights will include:

M:  BRC Like-for-like Retail Sales

T:  Manufacturing/Industrial Production, Trade Balance, Industrial Production, NIESR GDP Estimate

W:  Inflation Report Hearing

T:  BOE Credit Conditions Survey


USDCHF: 0.9776
Preferred Strategy:  US$Chf has reversed from new trend highs seen on Friday at the 200 DMA at 0.9835. The short term momentum indicators suggest that near term weakness may continue, possibly triggering SL orders below the rising trend support, currently at 0.9750. Any weakness is seen as temporary though and an eventual return to 0.9830, and higher, is favoured.

. Buy US$Chf @ 0.9735. SL @ 0.9670, TP @ 0.9850.

24 Hour: Prefer to buy dips Medium Term: Mildly Bullish
Resistance Support
0.9880 (50% of 1.0343/0.9420) 0.9750 Rising trend support
0.9850 200 WMA 0.9735 5 Oct low/200 HMA
0.9835 200 DMA/(61.8% of 1.0099/0.9420) /Friday high 0.9710 4 Oct low
0.9810 Minor 0.9676 2 Oct low
0.9790 Minor 0.9650 100 DMA

Economic data highlights will include:


T: Unemployment




AUDUSD: 0.7774
Preferred Strategy:  The Aud remains under pressure on Monday although it has recovered from Friday’s low of 0.7733.  We may see a continuation of the minor squeeze higher but selling into any move to back above 0.7800 seems to be the plan. Sell AudUsd @ 0.7815. SL @ 0.7855, TP @ 0.7725. The Caixin China Services PMI may create some volatility on Monday, or on the other hand, given the absence of the US markets it may be that we just hang close to the 100 DMA today.
24 Hour: Prefer to sell rallies Medium Term: Mildly Bearish
Resistance Support
0.7850 Minor 0.7750 Minor
0.7830 200 HMA 0.7732 Friday low
0.7815 Descending trend resistance/(23.6% of 0.8102/0.7732) 0.7725 (50% pivot of 0.7328/0.8125)
0.7800 Minor 0.7700 Minor
0.7780 100 DMA 0.7680 Minor

Economic data highlights will include:

M: Caixin China Services PMI

T: NAB Business Conditions/Confidence, China Money Supply, New Loans


T:  WBC Consumer Confidence, Home Loans, Investment Lending for Homes, China Foreign Direct Investment

F: Financial Stability Report, China Trade Balance.

NZDUSD: 0.7089
Preferred Strategy:  The Kiwi remains heavy although it has recovered from Friday’s low of 0.7058 and the short-term momentum indicators hint at the chance of another minor topside squeeze. However, the dailies look as though there is further downside to come at some stage, so as before, selling into strength seems to be the plan. Sell NzdUsd @ 0.7115. SL @ 0.7175, TP @ 0.7050.
24 Hour: Prefer to sell rallies Medium Term: Mildly Bearish
Resistance Support
0.7180 Minor 0.7070 Minor
0.7165 5 Oct high 0.7058 Friday low
0.7145 (23.6% of 0.7434/0.7058) 0.7050 Minor
0.7118 Friday high 0.7035 Minor
0.7100 Minor 0.7010 Minor

Economic data highlights will include:


T: Electronic Card Retail Sales


T:  Food Price Index,

F:  NZ Business PMI