Market rumour that funds will be released to Greece encouraged short covering in E$ to 1.2728 last night during the NY session. However, when no confirmation was received subsequently, market sold the E$ back down to 1.267ish only to be met with bids and it rebounded above 1.2700 to close at 1.2703. So far, most of the sell stops sub-1.2700 have been flushed and it seems like market is caught short E$ following a week of negative sentiment.
Notable orders:
Stop loss: < 1.2700
Limit: 1.2600/08 and 1.2620/30
EURUSD
Technically, short term intraday indicator is at o/b levels and market would consolidate lower from here at 1.2720. But overall intraday momentum has turned higher which has increased the probability of a near term bottom. This is further strengthened by the long-legged doji formation yesterday, following days of decline, which also increased the probability of a possible near term reversal. This would encourage a mean reversion to the 200DMA (Blue).
For today, expected range 1.2680/90 to 1.2790/810. I look to buy dip with risk below 1.2630.
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| E$ Daily chart - Retesting the 200 DMA (Blue) |
I have been monitoring this pair and recent price action has suggest a near term bottom been formed and strong upside momentum further confirmed by the RSI. Range may not be wide but quite manageable in terms of risk/reward. Look to buy dips. Support 65.15/25 and resistance 65.60/65 and 65.80/85
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| SGDJPY - Daily chart with 21DMA (Red) and RSI |
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