Market Commentary
Both the USD/JPY and Nikkei are at decade highs, and supported by official comments in the past twelve hours (Kuroda stating that “financial excess” in the economy is not present, and Suga choosing not to comment on FX moves as “it could give unnecessary impact on the market”). 124.28 the high in USD/JPY at writing, and the trend remains for a move towards the psychological 125. Above this level, would likely warrant caution of increased verbal intervention. 123.10/30 near term support.
Reports that Greece and its creditors are closer to striking a potential deal that would provide Athens much needed debt relief prompted some short covering for EUR/USD, hitting a peak of 1.0929 overnight. There is not much action this morning with prices entering into a consolidation phase hovering around the 1.0900 handle. Prices remain slightly bid in the meantime and we could potentially see more upside retracement to 1.1030/60 area Greece headlines will play a role in any further move, 1.0865 and then 1.0825 are the initial support levels.
We get the 2nd release of GDP for Q1 in the UK this morning, which could be pivotal for the currency as it approaches some support levels and trades relatively supported as the negotiations in Greece are showing some positive signs, 1.5300 is the pivot in cable to watch, where a break below could see us close the election gap down to 1.5240/50
Technical Commentary
EUR/USD Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks) Bearish
Yesterday we traded just shy of 1.08 equality corrective target which attracted anticipated bids on the first test, while this area holds expect retest of 1.1030/60 from below failure at 1.08 should see a quick test of 1.0660/80 next
Order Flow indicators; OBV sideways, Linear Regression and Psychology bearish but attempting retest of midpoint from below
Risk free longs in play – Long 1.0890 Stop 1.0875 (Half position closed +15pips)
GBP/USD: Short Term (1-3 Days): Bearish – Medium Term (1-3 Weeks) Bearish
1.53 equality corrective target attracts bids on first test while this area supports expect test of 1.5550 from below failure at 1.53 opens 1.5050 next
Order Flow indicators; OBV sideways to up, Linear Regression and Psychology bearish
Monitoring intraday price action and Order Flow indicators on a test of 1.53 or 1.5550
USD/JPY: Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks) Bullish
While 122 previous resistance now acts as support bulls now focus on 124 target.Yesterdays trade saw price action fall just short of 124, while 123 support intraday expect 124.50 test. Below 121 concerns near term bullish bias.
Order Flow indicators; OBV up to sideways, Linear Regression and Psychology bullish
Monitoring intraday price action and Order Flow indicators on a test of 124 or 122
EUR/JPY: Short Term (1-3 Days): Bullish – Medium Term (1-3 Weeks) Bearish.
134/133 continues to support now retesting the broken ascending trendline from below as this area rejects potential to retest 134 a break here sets retest of highs and potential 138 foray. Below 133 expect 130/131 base test.
Daily Order Flow indicators; OBV sideways to up, Linear Regression and Psychology pierce midpoints from below
Monitoring intraday price action and Order Flow indicators on a retest of 133 or 137/138
