Monday, 12 August 2013

USD has run its course?

Back after a short break and here's what I see unfolding:
1. These recent months of USD bull run is probably at its tail end or already run its course.
2. Euro, the quasi-USD, may soon feel the pressure as EURxxx start to correct the recent months of bull run.
3. If a major reversal is imminent, how does that correlate with the equity markets?

CFTC COT report: Speculator accounts as of 6 Aug 13
EUR:  -  8,504 vs  + 6,061
AUD: -72,573 vs   -67,797
JPY:   -82,135 vs   -80,213
Note: EUR has finally swung into net long. A$ and USDJPY are susceptible to short squeeze and long liquidation respectively.

Europe order book:
Stop loss: 1.3285/75, 1.3425 and 1.3450
Limit: 1.3235/30, 13300, 1.3350/55, 1.3390/400, 1.3410/20 and 1.3480/85

Primary trend: Bullish
Intermediate trend: Bearish for 1.2800/50
Minor trend: Mildly bearish

Technically, shorter intraday indicators are in o/s territory which could provide support at 1.3300 for now. However to note, the longer intraday still has room and the daily/weekly indicator are still in o/b zone. The dark-cloud cover candlestick pattern on Friday and the bearish divergent signal have both increased the probability of a near term top. Expected range 1.3350/60 to 1.3230/50.

E$ 8-hourly chart - Bearish divergence in the mature stage

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