E$ hit a high of 1.3140 before easing off as US name was heard to be the notable seller up there. Swiss name was later responsible for the fall below 1.3100. Market then capitalized on the sell momentum by pushing further on a rumour of a France credit rating downgrade to trigger more stops to touch a low 1.3056. Despite the denial from a french official, E$ only managed a mild recovery to close the trading day at 1.3080. Eurozone final GDP will announced at 1800hrs (Sin/HK).
Technically, E$ was rejected at the DMA21 (1.3140) and closed the day with a bearish piercing pattern. This does not bode well for E$ in the next 24hrs and I expect more selling pressure to challenge yesterday's low of 1.3056 and subsequently last week's low of 1.2998 which I see can be a tough level to break for now. Last heard was Asian sovereign demand around 1.3010 and from yesterday's order book, a couple of large option strikes at 1.3025 and 1.3010/00, which someone out here may have interest to defend unless it has already expired.
For today, E$'s mild rebound last night has unwound itself slightly off the o/s levels. Momentum continues to suggest a consolidation within a new range of 1.2990/300 to 1.3120/30 (retest of trend line, see chart). Initial resistance stands at 1.3090/3100 with stronger band at 1.3120/40. I will be a seller into rallies today and with stop above 1.3140 and happy to start profit taking around 1.3040-20.
Update1:
Wake up, lazy bones! I have already sealed 2 trades. Sold at 1.3089, tp at 1.30699. Bought at 1.30732, tp 1.30781. Looks like some demand at 1.3070, not going to fight it. Await sell opportunities again.
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| $E Daily chart - |
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