EURUSD
Last Friday saw the bears won the tug-of-war briefly by pushing E$ below 1.2700, tripping large stop loss orders to 1.2689 low before a mild rebound to hover around 1.2710/20. I have connected a few previous lows and highs to form a band (around 1.262ish to 1.269ish). Purpose of doing this is to show previous market reactions when close to these levels i.e. it is often rejected on first test. The large limit orders seem to reflect support this observation.
Notable orders just updated this morning:
Stop loss: 1.2690/00 and 1.2800-20
Limit: 1.2600/20, 1.2650/55 and 1.2700/05
As today is a U.S. federal holiday, I am not expecting a big trading range but instead a market consolidation of recent move.
Technically, intraday o/s environment, coupled with bullish divergence signal and weakening downside momentum would encourage short covering. Expected range 1.2680/00 to 1.2800/20.
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| E$ Daily chart - MAs cutting down and the band |
USDJPY
This currency pair having fallen for the past few trading days should find reprieve today as technical indicators show signs of near term bottoming. A long-legged Doji (following several down sessions) , weakening downside momentum and bullish divergence signals have all increased the probability of a rebound. Expected trading range 79.20/30 to 79.80/90.
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| USDJPY Daily chart - Long-legged Doji |
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