GROWTHACES.COM Forex Trading Strategies
Taken Positions
EUR/USD: long at 1.0990, target 1.1240, stop-loss 1.0940, risk factor ***
GBP/USD: long at 1.5470, target 1.5700, stop-loss 1.5400, risk factor ***
EUR/JPY: long at 134.50, target 137.20, stop-loss 133.50, risk factor ***
AUD/JPY: long at 91.60, target 94.00, stop-loss 90.65, risk factor *
Pending Orders
USD/JPY: buy at 122.10, target 124.20, stop-loss 121.40, risk factor **
USD/CHF: buy at 0.9300, target 0.9600, stop-loss 0.9235, risk factor **
EUR/CHF: buy at 1.0380, target 1.0580, stop-loss 1.0300, risk factor **
GBP/JPY: buy at 189.10, target 193.00, stop-loss 188.20, risk factor **
CHF/JPY: buy at 128.90, target 131.90, stop-loss 128.00, risk factor **
AUD/NZD: buy at 1.1180, target 1.1450, stop-loss 1.1110, risk factor **
EUR/USD: Greece Will Present New Reform Plan Today
(long at 1.0990)
- The European Central Bank left emergency liquidity for Greek banks at current levels but increased the haircuts on the collateral it demands. German 10-Year Bund yields fell the EUR eased against the USD on fears that Greek banks will soon run out of cash.
- European Central Bank policymaker Ewald Nowotny suggested the bank might be able to provide some sort of bridge funding while Greece negotiated a longer-term conditional loan to see it over a crucial July 20 bond redemption to the ECB.
- European Commission President Jean-Claude Juncker said Greece's government must come forward with proposals to resolve its debt crisis. The leaders of Germany and France said after conferring on Monday that the door was still open to a deal with Greece.
- Germany's Sueddeutsche Zeitung reported that proposals Greece will present to the Eurogroup today do not differ significantly from the reform plans that Greeks rejected in a referendum on Sunday.
- We went long on the EUR/USD at 1.0990, but the position is risky. Eurozone leaders and finance ministers are meeting in Brussels to discuss Greek reform plan and any progress should support the EUR. In our opinion the EUR/USD may be under pressure in the medium-term perspective due to approaching Fed hikes.
- The Institute for Supply Management said US services sector index increased to 56.0, below expectations of 56.2, from 55.7 in May. The employment index was surprisingly low at 52.7. That is down from May's 55.3, and the second-lowest print since April 2014. It is also out of line with the payrolls figures, which have seen healthy growth among private services firms, up 246k in May and 222k in June.
Significant technical analysis' levels:
Resistance: 1.1095 (high Jun 6), 1.1122 (high Jul 2), 1.1123 (10-dma)
Support: 1.0915 (low Jun 2), 1.0887 (low Jun 1), 1.0867 (low May 28)
AUD/USD: RBA Holds Rates Steady, As Widely Expected
(stop-loss hit at 0.7420)
- The Reserve Bank of Australia held interest rates at record lows today, as widely expected. The central bank underlined the need for a lower currency, even though it had only just hit a six-year trough on the USD.
- RBA governor Glenn Stevens said in a statement that although Australia's economy is growing at a below average pace, one good sign is that there are higher rates of borrowing. Stevens said the RBA expects to increase its policy rate later this year. However he left the door open for further rate cuts, saying monetary policy needs to be accommodative to global financial conditions.
- Interbank futures imply a 50% probability of a move by October, rising to 80% in December. In our opinion the RBA will keep interest rates unchanged till the end of the year.
- The picture of Australian economy is not all dark. The hundreds of billions lavished on mining is driving a sustained increase in export volumes, underpinning growth even as prices fall. Super-low mortgage rates have lit a fire in the housing market where approvals to build new homes are running at all-time highs and national prices are growing 10% annually. Government tax breaks for small business announced in May were well received and helped boost new vehicle sales to a record peak in June.
- The June jobs report is due on Thursday and confirmation of the improving trend would likely go some way to easing the central bank's concerns over the economy. Thursday’s data are expected to be weaker than in the previous month. However, our forecast is slightly above the market consensus.
- The AUD/USD fell to new multi-year lows today despite an absence of any surprises from Australia's central bank policy review. Our buy order was filled at 0.7480, but the AUD/USD hit the stop-loss at 0.7420 soon. In our opinion a stronger job report on Thursday may support the AUD in the short term and a corrective move towards 0.7700 is likely. However the AUD/USD may be under pressure in the coming weeks when the Fed suggests a high likelihood of a rate hike in September.
Significant technical analysis' levels:
Resistance: 0.7533 (high Jul 6), 0.7587 (low Jun 29), 0.7600 (hourly high Jul 3)
Support: 0.7400 (psychological level), 0.7335 (low May 6, 2009), 0.7302 (low May 4, 2009)
Source: Growth Aces Forex Trading Strategies