E$ fell short of my expected bottom before it staged a rebound for 1.3400 but only managed 1.3387 high so far. Traders continue to see Asian sovereign interest on both sides of the range, 1.3250/60 to 1.3395/405, for now with no mention of the US investment bank anymore.
I expect market to stay within 1.3330 to 1.3390 during the Asian/early Ldn session but very likely to retest Monday's high of 1.3404 during the NY session. Expanded range 1.3330 to 1.3430/40 (1.3470/80 aggressive). The next level of strong resistance is at 1.3520/30 (see chart, blue WMA). A firm close above 1.3400 for the week will increase the probability of 1.34866 being retested by next week. On the flipside, a softer close below 1.3330 will put 1.3250/60 and subsequently 1.3200 back on the radar.
With such a strong close last week, I would expect spillover momentum to take us higher this week. But to date E$ continue to struggle below 1.3400 which is not a good sign unless it takes off by this evening and close firm as mentioned. Even then, 1.3480 to 1.3530 remains as a formidable resistance band and I foresee E$ to be rejected on first test.
Update1:
Asian order book:
Stop loss: 1.3245/40, 1.3280/70 and 1.3410
Limit: 1.3260/50 and 1.3395/405
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| E$ Weekly chart - 100WMA Brown & 200WMA Blue |
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