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

By | October 9, 2019

It has been another choppy, sideways session in the FX markets, and given the empty calendar, there is not much inspiration to be found on the trend table today, so a generally cautious stance is required. Another range trade day looks most likely in the FX space, with Cable looking a bit heavy because of the never-ending Brexit issues, while the Kiwi looks a little heavy on all time frames on the charts.

The outcome of the US/China trade talks will be pivotal for all asset classes and at this stage, with the general lack of optimism over the eventual outcome, it would seem that there is more downside ahead for stocks, as well as potential for the metals to rally further.

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*Trade of the day: October 8, 2019; 7:22 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 @ 1.1000. SL @ 1.1030, TP @ 1.0920

Buy EurUsd @ 1.0915. SL @ 1.0890, TP @ 1.0990

Sell AudUsd @ 0.6755. SL @ 0.6785, TP @ 0.6690

Buy AudUsd @ 0.6695. SL @ 0.6650, TP @ 0.6745

Sell NzdUsd @ 0.6320. SL @ 0.6350, TP @ 0.6240

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EurUsd:  The Euro has had another choppy day, confined to a tight range at similar levels to Tuesday and leaves the outlook unchanged, with a neutral bias. The pair currently sits at 1.0955, well above the 2 ½ year low at 1.0879 but unable to overcome stiff resistance at 1.1000, and while the short term momentum indicators look mixed/neutral, it would seem that 1.0920/1.1000 may again cover it on Wednesday. If wrong, a break 1.0900 would then open the way back to the 1.0879 low below which would allow a run towards the next target at 1.0860(76.4% of 1.0340/1.2555), Under here, the 23 April 2015 low is at 1.0820, a break of which will find a weekly chart gap that would take us to 1.0775. On the topside, the 55h/100H moving averages are crossing at 1.0970, which should bring some minor sellers, above which, resistance is strong at 1.1000/03 (Session high/23.6% of 1.1411/1.0879). An upside break would then allow for a run towards 1.1040/50 and then possibly to the September 18/19 highs at 1.1072/75. Trading a range of 1.0915/1.1000 may be the idea today.

 

US$Jpy:  was unable to overcome the sellers at 107.45 and has since dipped back to 106.80 ahead of a bounce, to currently sit at 107.00. The price action will continue to be choppy, based on the latest trade talk headlines coming for the US/China, and thus, a cautious stance is required. The charts are showing little directional bias today, but if we do see further upside progress, good resistance is once again going to be found at 107.45/50 (7 Oct high/200 HMA/50% pivot of 108.46/106.47) but above which could open the way to 107.70 (61.8%/100 DMA), to 108.00(76.4%) and possibly back to the 108.46, 1 Oct high. On the downside, support will be seen at 107.00 (100 HMA), ahead of 106.80 (Session low) and 107.60 (both minor) and the 106.47 Friday low. Look for 106.80/107.40 to cover it today, although any trade headline could provide something more directional.

 

AudUsd:  The Aud$  did try the topside on Tuesday, squeezing up to 0.6756 before giving up some ground to currently sit back at 0.6730.  A break of minor support at 0.6720 could see a drift back towards 0.6700, below which would allow for a run back towards the 0.6670 lows.  A break of this would find minor support at 0.6660, but under that would open the way to 0.6600, and possibly to 0.6500 although that remains some way off. Further out, the next major Fibo support level is not seen until 0.6250 (76.4% of 0.4773 (April 2001)/1.1082 (July 2011). On the topside, resistance will once again be seen at 0.6750/55 ahead of 0.6770/75 although that looks safe today. Further offers would arrive at 0.6795/0.6805 ahead of the Fibo level at 0.6828(38.2% of 0.7081/0.6770) 0.6850 (minor) and 0.6876 (50%). It may be a quiet session but I prefer the downside today, with any directional move likely to come via the WBC Consumer Confidence, and then later, on any trade headlines. Once again, I am while looking to sell rallies although 0.6700/50 may cover it.

                                   

NzdUsd: The Kiwi squeezed up to 0.6326 on Tuesday on some improved NZ data but is now back below 0.6300 and is looking heavy on the short term time-frames on the charts. Further losses would open the way for a drop back towards 0.6280 and then towards 0.6255/60, 0.6220 and possible back to the 0.6203, 4 year low. 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, which could be where we are headed if/when the RBNZ cut rates again, which seems highly likely. If we get back above 0.6326 (Session high), look for further sellers to arrive at 0.6337 (4 Oct high) and then at 0.6348 (25 Sept high) ahead of 0.6355 (61.8% of 0.6449/0.6203). Use 0.6265/0.6320 as a guide today, with the preference to sell rallies for the 24 hour trade.