USD back on track.....

Market whipsaw as expected during the NY session as Bernanke clarified his stand on Fed's action on QE. Amid the volatility, DXY closed Wednesday weaker below the DMA21. USD bears' victory was short lived as the index surged through the resistance to recapture the pivot point this morning. Having observed the price action in the past 24hrs, it has become apparent that the recent USD correction might have already run its course and is ready to power ahead again in the coming weeks.

Europe order book:

EUR:

Stop loss: 1.2990, 1.3050-40, 1.3065, 1.3170-90

Limit: 1.3060/50, 1.3150, 1.3170-90, 1.3200-10 and 1.3250/60

JPY:

Stop loss: 98.80, 99.25/20, 100.45/50, 100.90/00, 101.50 and 102.00

Limit: 99.00, 100.45/50, 100.80, 100.90/00, 101.50 and 102.00

E$

Primary trend: Bullish

Intermediate trend: Range between 1.2800 to 1.3200/50

Minor trend: Mildly bullish but capped at 1.3200/50

Still maintaining my view that E$ will be capped around the upper band 1.3200/50 and eventually fall back to 1.2750/2800. But however, EUR crosses should remain relatively firm.

Technically, intraday indicator has unwound from its o/s condition but still has room on the upside. However, daily indicator is just getting into o/b level. Shorter intraday momentum indicator suggest range consolidation between 1.3080/90 to 1.3180/200 but longer ones are beginning to point lower.

Expected trading range 1.3170/90 to 1.3040/50. Prefer to fade into rallies. 

E$ Daily chart - Pretty much sums up my view for 2013....

USDJPY

In view of the USD strength, USDJPY should continue to stay firm with initial target of 101.53. However, one has to take note of the event risk i.e. the Japanese election over the weekend. Strong supports levels are 98.00/10, 99.00/10 and 99.60/70. 

USDJPY Daily chart - Y99.00 has formed a solid base to propel it higher....

AUDNZD

Price action in the past 12hrs has not been encouraging and coupled with the view that AUDUSD has probably seen its near term highs around 0.9300, I have decided to cover the long and take a small loss. In the coming weeks, I expect AUDUSD to fall towards 0.8800/50.